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Singtel grabs $4.17 billion credit lifeline

Ng Qi Siang
Ng Qi Siang4/24/2020 06:49 PM GMT+08  • 2 min read
Singtel grabs $4.17 billion credit lifeline
Under pressure from Covid-19, Singtel looks to fortify its cashflow with a substantial credit injection as the pandemic takes its toll.
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SINGAPORE (Apr 24): Amid cash flow pressure from the Covid-19 pandemic, Singtel Group announced today that its wholly-owned subsidiaries, Singtel Group Treasury, and Australia-based Optus Finance, have secured S$4.17 billion worth of credit facilities for general corporate purposes and refinancing of existing facilities.

Said Group Chief Financial officer Lim Cheng Cheng, “The Singtel Group is very pleased with the level of support demonstrated by our bankers in Singapore and Australia. This reflects their confidence in the Singtel Group’s credit quality and business fundamentals.”

In Singapore, Singtel Group Treasury -- a group subsidiary -- agreed upon a three-year S$2.5 billion committed revolving credit facility with 13 banks. These include all three major local banks as well as the Singapore branches of major foreign banks such as Bank of America, N.A., Sumitomo Mitsui Banking Corporation Singapore, the Hongkong and Shanghai Bank Corporation and Societe Generale (France).

Singtel Group Treasury has also signed a one-year committed facilities -- guaranteed by Singtel -- totalling S$950 million with an undisclosed group of banks.

In Australia, Optus Finance -- owned by Singtel subsidiary Optus -- has secured 364-day committed facilities totalling A$800 million (S$726 million) with another undisclosed group of banks. Optus and some of its subsidiaries will serve as guarantors.

This move came amid the liquidation of streaming service HOOQ Digital on March 27, in which Singtel had an indirect 76.5% effective stake. HOOQ laid off its global workforce of around 240 workers. Singtel is also looking to sell off its telecommunications towers in Australia worth A$2 billion.

At market close, Singtel stocks are currently priced at $2.70. This represents a dividend yield of 6.48% and a price-earnings ratio of 34.66. The counter experienced an eleven-year low on March 13, as a result of weakening investor confidence from the Covid-19 virus.

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