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The bonds will bear interest at an annual rate of 1.75% and the conversion price has been set at US$27.1396, a 37.5% premium over the share price. The net proceeds of the bonds will be used to take advantage of organic and inorganic growth opportunities, diversify funding sources and general corporate purposes.
J.P. Morgan Securities plc is acting as Global Coordinator, Joint Bookrunner and settlement agent on the Bond offering. Citigroup Global Markets Limited, HSBC Bank plc and UBS Limited are each acting as Joint Bookrunners on the Bond offering.
DP World Chairman, Sultan Ahmed Bin Sulayem, stated:
The proceeds from the convertible bond provide us with additional financial flexibility at an extremely low interest rate to take advantage of further organic or inorganic investment opportunities in order to enhance returns to shareholders over the medium term.
DP World Group Chief Executive, Mohammed Sharaf, stated:
We are taking advantage of the current low-cost financing opportunities in the convertible market to secure long-term financing so we can continue to grow our business to meet the changing needs of our customers. The issuance also allows us to diversify our funding sources and access a broader investor base.
It is intended that, following settlement of the bonds, an application will be made for the bonds to be listed on the Open Market segment of the Frankfurt Stock Exchange.
DP World, an Emirati marine terminal operator, has a portfolio of more than 65 marine terminals across six continents, including new developments under way in India, Africa, Europe and the Middle East. Container handling is the company's core business and generates more than three quarters of its revenue. In 2013, DP World handled 55 million TEU. With its committed pipeline of developments and expansions, capacity is expected to rise to more than 100 million TEU by 2020, in line with market demand.