Singapore’s Sembcorp Marine has been awarded a five-year S$2bn ($1.5bn) subordinated loan from its controlling shareholder, Sembcorp Industries.
Sembcorp Industries expects the loan will strengthen Sembcorp Marine’s financial position amidst the current downturn in the global offshore and marine industry.
Sembcorp Marine will use the loan to retire approximately S$1.5bn of borrowings and the balance for working capital and general corporate purposes.
Sembcorp Industries will issue S$1.5bn of bonds to DBS Bank as sole lead manager and initial purchaser through a private placement. Temasek is one of the bonds’ investors. The remaining S$500m will be funded by Sembcorp Industries’ existing available resources and facilities.
Earlier this year, Sembcorp Marine announced that it is shuttering its Tanjong Kling yard by the end of this year, four years ahead of schedule.