UPDATE 1-Genting Singapore to issue $397 mln in perpetuals

Mon Apr 9, 2012 4:16am EDT

(Adds comments from company, background)

By Charmian Kok

SINGAPORE, April 9 (Reuters) - Casino operator Genting Singapore PLC is planning a second issue of perpetual securities worth about $397 million and could use the proceeds to expand into Japan and South Korea, a senior executive said on Monday.

Genting Singapore, a unit of Malaysian group Genting Bhd , plans to sell S$500 million ($397 million) in perpetual subordinated capital securities, a hybrid of bonds and equities, to mostly retail investors.

This follows its S$1.8 billion issue of perpetual securities last month that was sold mainly to institutional and private banking investors.

"We are well positioned for opportunities such as those in Japan and Korea," Chief Financial Officer Lee Shi Ruh said at a media briefing.

Casinos are banned in Japan but a group of lawmakers is pushing for a bill that could legalise them. In South Korea, only one of its casinos is open to citizens and it is located in a rural area far from major cities.

Lee said the potential liberalisation of Japan and South Korea's gaming industries could follow a similar path to Singapore, which legalised casinos in 2005. The two integrated casino resorts in Singapore have helped boost its tourism industry.

If Genting Singapore, which runs the Resorts World Singapore casino, invests in Japan or South Korea, the projects would most likely be in new "greenfield" developments rather than acquisitions, Lee said.

The company is open to acquisitions in other markets, Lee said, but she declined to name them.

Genting Singapore's latest issue will pay an annual coupon of 5.125 percent until October 2022 and 6.125 percent after that, with the company having an option to redeem the securities in 2017.

Issuing perpetual securities has been growing in popularity in Asia, due partly to favourable accounting practices that could translate into lower leverage ratios for companies.

DBS is the sole global coordinator for the offering. DBS and Oversea-Chinese Banking Corp are the joint lead managers and book runners. ($1 = 1.2590 Singapore dollars) (Editing by John O'Callaghan)