Bangkok, Thailand: Chandler Mori Hamada has advised on a landmark asset-backed securities issuance under a securitisation transaction originated by Dhanarak Asset Development Co., Ltd. (DAD), a state-owned enterprise wholly owned by the Ministry of Finance and overseen by the Thai Treasury Department (TD). The issuance by the special-purpose vehicle, DAD SPV Company Limited (DAD SPV), comprises six series of THB bonds with tenors of two, three, four, five, and eight years.
The bonds are backed by irrevocable and unconditional lease and service-fee payments from the TD as the sole tenant under long-term agreements for the Government Complex at Chaeng Watthana. These payments provide AAA quality cash flows, underpinning the strong credit profile and stability of the issuance.
The joint lead underwriters were Bangkok Bank, Bank of Ayudhya (Krungsri), Krungthai Bank, and the Government Savings Bank (GSB). Bank of Ayudhya also acted as registrar and paying agent, as well as bondholders’ representative.
This transaction marks a landmark development in Thailand’s capital markets, the Asset-backed Securities - that includes both institutional and retail participation. Notably, Series 5 was explicitly offered to the general public, representing one of the first securitisations in recent years to feature a retail participation tranche and the first corporate bond the featured a small-lot-first allocation.
Investor demand exceeded THB 33,000 million, reflecting exceptionally robust market interest. The offering was oversubscribed by approximately three times overall, underscoring investors’ strong confidence in the transaction. The strength of the issuance is also reflected in the AAA (sf) ratings by TRIS, underscoring the exceptional credit quality of the transaction, which benefits from the strong creditworthiness of the Treasury Department as the sole obligor.
This is a remarkable transaction for the Thai market:
- It involves a Thai SOE (DAD) and a government complex asset, securitised via lease and service fee payments from a state department (TD). This is a truly unique structure in the Thai market.
- It benefits from highest credit characteristics, with the Treasury Department as the sole obligor and prudent waterfall and cash reserve structure, justifying its very high rating (AAAsf) and attracting strong institutional investor interest.
- Its robust structural features including series of bullet and amortizing bonds to match the underlying cash flows, and unconditional and direct payments to the SPV contribute to its strong risk profile and investor confidence.
Chandler Mori Hamada’s team was led by Partner Doungporn Prasertsomsuk, supported by associates Pradchayada Maneeratanapron and Praewa Silapunt.
Doungporn Prasertsomsuk commented, "With securitizations being rare in the market, especially public ABS, this is a groundbreaking and remarkable transaction which could be a blueprint for future securitisations in Thailand. I would like to thank the clients and all the teams involved for their dedication and hard work in ensuring the great success of this issuance"
Recognized as an innovative leader in Thailand’s debt capital markets, Doungporn Prasertsomsuk has consistently ranked top-tier by independent global legal publications, solidifying her reputation as a leader in the field.
About the Originator, Dhanarak Asset Development Co., Ltd. (DAD)
DAD is a state-owned enterprise under the Ministry of Finance, established to develop, manage, and operate government office facilities, including the Government Complex at Chaeng Watthana.
About Chandler Mori Hamada
Chandler Mori Hamada is a leading law firm in Thailand. Our firm combines international standards of legal practice with decades of local experience within the Thai legal environment. Our team of more than 100 lawyers in Thailand is recognised internationally for its legal expertise.
For media inquiries, please contact Business Development at business-development@morihamada.com
