CapitaLand Ascott Trust to call its 2019 perps, plans to replace with new tranche

CapitaLand Ascott Trust set to call $150 million perps issued in 2019 this September

CapitaLand Ascott Trust (CLAS) has announced it will call its $150 million, 3.88% perpetual securities issue in September 2019 on September 4. During CLAS 1HFY2024 results briefing on July 26, Serena Teo, CEO of CLAS' trustee manager said she viewed perpertual securities as equity.

An ongoing debate on whether perpetual securities should be viewed as debt or equity - they are in effect hybrids - continues. The current regulations enable perpetual securities to be classified as equity. However their distributions have to be taken into account for the calculaiton of interest coverage ratio. If perpetual securities are classified as equity, they appear "cheap". However perpetual securities are also viewed as expensive debt.

CLAS will be replacing its $150 million perps with a tranche of $150 million perpetual securities priced at 4.6%,

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