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Hubline to raise $50m through bond issue to fund dry bulk expansion

Sarawak-based regional line Hubline is raising funds up to MYR200m ($50.2m) through a notes issue, mainly for repaying borrowings and buying six new shipping vessels, the company said in a stock market announcement.

Vincent Wee, Hong Kong and South East Asia Correspondent

July 20, 2016

1 Min Read
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The redeemable convertible notes will have a total principal amount of up to MYR200m comprising four tranches with an interest of 1% per annum and a five-year tenure from the closing date of the first subtranche of the Tranche 1 notes.

The issue is being handled by Advance Opportunities Fund I and Advance Capital Partners Asset Management Private Ltd.

Hubline expects the first sub-tranche of the Tranche 1 notes to be issued in the first quarter of 2017.

Of the expected MYR200m gross proceeds half will be used for partial repayment of borrowings/credit facilities. As at 31 March 2016, the group had total borrowings of MYR159.32m; and a reduction to MYR59.32m will result in an estimated interest savings of MYR7.04m per annum.

About MYR70m will be used for capital expenditure, including the purchase of six new sets of tugs and barges to boost Hubline's dry bulk business.

Last year, the company decided to focus on dry bulk shipping and ceased its container shipping business, which had been loss-making for several years due to intense competition from larger capacity container vessels and decreasing charter rates.

Read more about:

dry bulk shipping

About the Author

Vincent Wee

Hong Kong and South East Asia Correspondent

Vincent Wee is Seatrade's Hong Kong correspondent covering Hong Kong and South China while also making use of his Malay language skills to cover the Malaysia and Indonesia markets. He has gained a keen insight and extensive knowledge of the offshore oil and gas markets gleaned while covering major rig builders and offshore supply vessel providers.

Vincent has been a journalist for over 15 years, spending the bulk of his career with Singapore's biggest business daily the Business Times, and covering shipping and logistics since 2007. Prior to that he spent several years working for Brunei's main English language daily as well as various other trade publications.

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