Naver succeeds in issuing $133 mn Samurai bonds

South Korea's Naver Corp. announced on Thursday it successfully issued Samurai bonds, becoming the first global IT company to do so.

Naver's debut Samurai bonds comprise four tranches with maturities of 3.5 years, totaling 14 billion yen ($93 million); 5 years, 1.5 billion yen ($10 million); 7 years, 1.5 billion yen ($10 million); and 12 years, 3 billion yen ($20 million), amounting to a total of 20 billion yen ($133 million).

The issuance rates were determined by adding spreads of 70 basis points (bps) for the 3.5-year tranche, 82 bps for the 5-year tranche, 93 bps for the 7-year tranche and 120 bps for the 12-year tranche to the Tokyo overnight average rate (TONA).

The latest issuance marks the first debut of Samurai bonds by a domestic private company without a guarantee in over seven years since 2016, and notably, the 12-year tranche represents the first long-term issuance beyond 10 years among domestic issuers.

Being the world's first case of a global IT company issuing Samurai bonds targeted at Japanese bond investors, even with an average maturity of over 5 years, this issuance serves as a testament to Naver's sustainable business prospects.

This issuance follows Naver's debut in the dollar-denominated bond market with $500 million in March 2021 and an additional $300 million in May 2021, marking the company's second international issuance.

Naver, as a joint controlling shareholder of Japan's top global messenger, LINE, and the largest Internet firm in Japan, LINE Yahoo, has been expanding its presence in the Japanese market. To diversify its fundraising sources, Naver has embarked on Samurai bond issuance.

"Through this debut issuance of Samurai bonds, we have earned trust in the Japanese bond market," Naver's Chief Financial Officer Kim Namsun commented. "This issuance also broadens the stage for Naver's diversified bondholders and accessible global capital markets, enhancing our capacity to secure stable liquidity for long-term growth."

Write to Hyun-Ju Jang at blacksea@hankyung.com