IVL prepares to issue subordinated perpetual bonds to be offered to the public, expected between July 1-4, 2024, through leading financial institutions. The coupon rate for the first five years is between [5.90-6.10]% per annum, payable every six months. The company is confident in receiving positive responses from investors due to the satisfactory returns, consistent redemption history every five years of the past perpetual bonds, and the perpetual bonds ‘A’ credit rating reflecting strength as a leading sustainable chemical company making great products for society.
Indorama Ventures Public Company Limited (SET: IVL), a global sustainable chemical company, prepares to issue and offer perpetual bonds, redeemable upon company liquidation, with the issuer’s right to redeem the perpetual bonds early and the right to defer interest payments without any conditions (“perpetual bonds”). The offering is for the 1/2024 tranche, with the issuer’s credit rating at “AA-” with a stable outlook and the perpetual bonds’ credit rating at “A,” rated by TRIS Rating on April 30, 2024. The company has set the coupon rate for the first 5 years in the range of [5.90 – 6.10]% per annum, with the final coupon to be announced, payable every 6 months throughout the term.
The issuance of perpetual bonds in this instance aims to prepare for the redemption of previous perpetual bonds issued in 2019, which will reach 5-year maturity in November 2024. Indorama Ventures is among the pioneering companies in Thailand to issue its first perpetual bonds in 2014 and 2019, with consistent redemptions on the first call date at the end of 5 years from the date of issuance. This underscores the company’s track record of regular redemptions as a perpetual bonds issuer that has constantly gained investors’ confidence.
This perpetual bonds offering is expected to take place between July 1-4, 2024, offered to the public, through leading financial institutions appointed as joint lead arrangers. These include Bangkok Bank, Krungthai Bank, Kasikornbank, Siam Commercial Bank, CIMB Thai Bank, Kiatnakin Phatra Securities, Krungthai XSpring Securities, Maybank Securities (Thailand), Yuanta Securities (Thailand), Asia Plus Securities, and Thanachart Securities. Currently, the company is in the process of submitting the information memorandum and draft prospectus to the Securities and Exchange Commission (SEC), which has not yet become effective. Investors can obtain additional details at www.sec.or.th.
Mr. DK Agarwal, Deputy Group CEO and Group CFO at Indorama Ventures, said, “We are confident that these perpetual bonds remain desirable and attractive to investors, given the ‘A’ issue credit rating and satisfactory returns. The business fundamentals and financial strength of Indorama Ventures also provide constant proof for investor confidence in their decision to invest in the company’s perpetual bonds in this offering, as in previous occasions.”
Indorama Ventures is one of the world’s largest producers of chemical products, with more than 140 facilities located in 34 countries spanning Asia Pacific, North America, South America, Europe, and Africa. The company’s product range extends from upstream products, including necessary chemicals for consumer goods production to downstream products, such as fibers, yarns, and PET resins, which are commonly used in food and beverage packaging and are 100% recyclable. All of Indorama Ventures’ products are connected with the daily lives of billions of people, from day to night. The company’s customers come from various business sectors, including food and beverage, healthcare products, personal care products, and automotive industries.
Currently, Indorama Ventures operates within three business segments. Firstly, the Combined PET business segment stands as the world’s largest producer of PET resin, with a total production capacity of approximately six million tons per year. Notably, in the Packaging business, major customers include globally renowned beverage companies and FMCG manufacturers such as L’Oreal, Pepsi, Coca-Cola, and P&G. This segment also makes the company a significant player in industries related to medical equipment, high-quality bottles and films, and specialty textiles.
Secondly, the Indovinya, formerly known as the Integrated Oxides and Derivatives (IOD) business segment, focuses on environmentally friendly chemical innovations, particularly in surfactants, which enhance the dispersion of liquids and reduce surface tension between two different liquids. This segment is crucial in the production of various products, including household cleaning products, detergents, kitchen cleaners, soaps, toothpaste, shampoos, skincare and body care products, cosmetics, sunscreens, and herbicidal chemicals, among others.
Lastly, the Fibers business segment produces fibers used in a wide range of hygiene products, such as baby diapers and face masks, lifestyle products like apparel and furniture, and all mobility products, including fibers for car interiors and tire cords.
“Our company’s new strategy, IVL 2.0, underscores our commitment to further strengthen our financial structure while further enhancing our business model’s capabilities. Leveraging our unmatched global production footprint, we aim to sustain our industry leadership. This entails optimizing our debt structure, enhancing the quality of earnings, and fostering cash flow through a disciplined capital approach. We are confident that these measures will certainly instill investor confidence in our perpetual debentures,” added, Mr. DK Agarwal.
Indorama Ventures places great emphasis on innovation and sustainability, setting clear sustainability indicators, which can be achieved through initiatives such as PET recycling, decarbonization, renewable energy, and human capital development.
In 2023, Indorama Ventures was included as a member of the Dow Jones Sustainability World Index (DJSI World) for the fifth consecutive year and a member of the Dow Jones Sustainability Emerging Markets Index (DJSI Emerging Markets) for the seventh consecutive year. Additionally, the company ranked first in the FTSE4Good Index Series, scoring 4.5 out of 5 in Environmental, Social, and Governance (ESG).
In addition, in 2024, MSCI (Morgan Stanley Capital International), a leading provider of research-driven indices and analytics, awarded the company an upgraded ‘AA’ from ‘A’ rating
