Clifford Chance

Clifford Chance advises HSBC and Standard Chartered Bank on innovative pre-listing liability management transaction by Olam

Leading international law firm Clifford Chance has advised HSBC and Standard Chartered Bank as dealer managers on the debt capital markets aspects of Olam International's business reorganisation. The liability management exercise comprised an exchange offer and consent solicitation across Singapore dollar and U.S. dollar-denominated senior notes and perpetual securities, and involving multiple clearing systems, including the SGX's Central Depository Pte. Ltd., Euroclear and Clearstream.

The Clifford Chance team was required to advise across English, Singapore, EU and US federal securities laws aspects of the transaction. The transaction is the first of its kind in the Singapore market due to the breadth and value of securities involved, its novel structure and value, and is an integral part of the overall business reorganisation of Olam International's agribusiness into Olam Food Ingredients, Olam Global Agri and Olam International. 

Partner Gareth Deiner who led on the deal said, "We are very pleased to have supported HSBC and Standard Chartered Bank on this market-first liability management transaction for one of the world's largest agricultural commodity traders. The complex nature of this successful liability management exercise is a hallmark of our extensive experience of providing integrated, strategic counsel for the most significant capital markets transactions in Southeast Asia, and across both Singapore and international laws."

Gareth was supported by senior associate Claire Neo, associate Jasmine Wong and trainee associate Daniel Ng.

The consent solicitation affected Olam International's five outstanding bonds, including: S$500 million 6.00% notes due 2022, US$300 million 4.375% notes due 2023, S$600 million 4.00% notes due 2026, S$350 million 5.50% subordinated perpetual securities and S$550 million 5.375% subordinated perpetual securities.

Investors holding the 5.50% subordinated perpetual securities were also invited to exchange the notes for 5.375% subordinated perpetual securities. Holders of S$54.5 million subordinated perpetual securities had accepted the exchange for the new subordinated perpetual securities, which will leave the outstanding balance of the 5.50% subordinated perpetual securities at S$295.5 million. The exchange will bring the total outstanding amount of the 5.375% subordinated perpetual securities to S$604.5 million.

Clifford Chance has a prominent track record advising market-leading corporate and capital markets transactions in Southeast Asia, including Indonesia's first sustainability-linked bond and the first US dollar denominated sustainability-linked bond from Southeast Asia; multiple landmark capital markets financing transactions by Singapore Airlines, involving the largest convertible bond from a Singapore-based issuer in a decade and the largest conversion premium achieved by an airline issuer in Asia (ex-Japan); Southeast Asia's first public sustainability-linked bond issuance, also the first Singapore dollar denominated sustainability-linked bond; and Star Energy Geothermal Group on its offering on the Singapore Stock Exchange of a dual tranche US$1.1 billion green project bond, the first investment grade green project bond from the private sector in Indonesia.