Wilmar

DBS on 13 Jan 2012

DBS Vickers Securities in a Jan 13 research report says: "As part of its US$5.0 billion Medium Term Note (MTN programme, Wilmar announced its pricing for $250 million 3.5% Notes due 2017 and $100 million 4.1% Notes due 2019. Both 5-year and 7-year Notes will be issued on Jan 25.


 "The proceeds will be used for general corporate purposes. Based on its balance sheet as at Sep 30, 2011, Wilmar had US$12,261.1 million net debts, of which US$6,869 million was liquid working capital (including Readily Marketable Inventories). Excluding liquid working capital, net gearing was hence calculated at 42.1% (not including non-controlling interest).


 "The new Notes will raise Wilmar's net gearing slightly to 44.2% - which we believe is manageable for the group (i.e. no significant impact on interest cover). Target price of $5.40 remain unchanged. HOLD"