Thai Union expects strong interest in its Bt4 bn debentures

The subordinated perpetual debentures, which also include an additional greenshoe offering of Bt2 billion, promises an annual return of 5 per cent for the first five years, payable quarterly. 
TRIS Rating has given the debentures an A- score, while Thai Union has been given a A+ rating with a stable outlook.
The debentures, which should be up for sale between November 26 and 28, will strengthen Thai Union’s financial structure and build a long-term foundation for the company. 
“At Thai Union, we have built a company that is financially robust thanks to our strict financial management,” Thai Union CEO Thiraphong Chansiri said.
“We believe our stability, together with our potential for strong growth due to our global footprint and growing investment in innovation, will be attractive to investors, who are also looking for a healthy return on investment.”
Chansiri said the subordinated perpetual debentures will not only provide a strong financial structure for Thai Union, but also give it flexibility for growth and further investment to strengthen the company.
Thai Union’s subordinated perpetual debentures No 2/2019 are payable upon liquidation with the issuer having a call option and unconditional interest deferral.
The company also retains the right to call the debentures after five years or upon other conditions in accordance with the terms and conditions of the debentures as specified in the prospectus.
The debentures will be offered to the general public and/or institutional investors via joint lead arrangers Bangkok Bank, Krung Thai Bank, Siam Commercial Bank and Phatra Securities.
TRIS Rating gave Thai Union an A+ score because of its business performance as well as its strong strategy that focuses on new product development, cost controls and improving production efficiency. The company’s debt burden has also been lowered as a result of improved business performance and a reduction in expenditure.
Thai Union, which has a portfolio of 14 brands around the world, was recently ranked No 1 in global Food Products Industry Index of the Dow Jones Sustainability Indices (DJSI) for a second year running and has been part of the DJSI for six consecutive years, driven by SeaChange, its global sustainability strategy.
Moreover, Thai Union’s Global Innovation Centre (GIC), which was established in 2015, acts as a centre for research and the development of products for the company’s brands around the world.
It was also created to combine modern nutritional science and production innovation to develop products that address the needs of consumers and the global food industry. The GIC also uses technology and innovation to improve production processes, providing additional benefits and value to customers, consumers and stakeholders.
“Thai Union’s strict financial management, together with a strong and cautious approach to risk management, has always allowed the company to not only manage its debts, but also to continue paying dividends to shareholders,” Chansiri said. “Thai Union also adopted the new accounting system TAS32 earlier this year, and these debentures align with these regulations.”