Temasek unit raises $510m through PE-backed bond issue

The bonds were issued earlier this month by Astrea III, a vehicle sponsored by Azalea Asset Management subsidiary Astrea Capital; Azalea is owned by Temasek, though with an independent board and management. Astrea III is managed by Fullerton Fund Management, a separate subsidiary of Temasek.

Demand for the bonds, which were oversubscribed, came mainly from institutional investors including insurance companies, endowment funds and foundations. Individual investors bought about a third of the bonds.

Astrea's offering fell into several categories, with $170 million in Class A-1 notes, $170 million in Class A-2 notes - both rated A by Fitch Ratings - and $100 million in Class B notes rated BBB. An additional $70 million in unrated Class C notes was also issued. All categories have a maturity of 10 years; $440 million worth of the bonds are publicly listed.

The funds on which the bonds are based are valued together at $1.14 billion, and are managed by 26 GPs including Blackstone Group, KKR, TPG Capital and Warburg Pincus. Temasek's goal in issuing the bonds is to reach a broader investor base for its private equity funds beyond its relatively small group of current backers. Its previous efforts in this direction include the launch in 2014 of the co-investment vehicle Astrea II, which allowed six outside institutional investors exposure to its PE fund portfolio; the vehicle followed a similar fund, Astrea I, launched in 2006.

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• Topics
• Southeast Asia
• GPs
• Financials
• Singapore
• Temasek Holdings