IFRASIA

INTERNATIONAL FINANCING REVIEW ASIA

April 16 2022 ISSUE 1232 www.ifre.com

GoTo’s unexpectedly strong debut

buoys Indonesian tech IPO hopefuls

Philippines plays sustainability card

in well-received Samurai bond return

Yunnan state-owned issuer braves

tough market with green/SLB combo

BONDS BONDS LOANS PEOPLE & MARKETS

Hong Kong makes
up for lost time
with bold green
retail bond plan
07
India’s central ESG financings Sri Lanka announces
bank starts draining take off in Japan default ahead of
liquidity, sending with support from expected ‘brutal’
yields higher BOJ scheme debt restructuring
08 09 12
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Upfront
Crumpled Colombo
I
n hindsight, it is surprising that Sri Lanka did not
default earlier. Even at the time of the sovereign’s debut
offshore bond issue in October 2007, the opposition
United National Party said it would not honour the debt if it
took power.
Since then, Sri Lanka has endured the global financial
crisis, the conclusion of a civil war, and terror attacks. But
it was the mishandling of the economy that finally brought
it down.
Like many corporate treasurers these days, Sri Lanka is
blaming its default on Covid-19 and Russia’s invasion of
Ukraine, even though it was in deep trouble years ago.
The pandemic hurt tourism, an important part of the
economy, and the recent spike in oil prices led to fuel
shortages and power cuts across the island, but the country
might have been able to deal with these shocks if its
finances had been in a less fragile state.
Sri Lanka did not seem to learn any lessons from its
last IMF bailout in 2016, and cut taxes shortly before the
While the government
was trying to keep foreign
creditors happy, ordinary Sri
Lankans endured hardships.
pandemic hit. Interest payments on government debt
accounted for more than 40% of government revenue before
Covid-19 struck, and Fitch estimates this rose to around 80%
from 2020.
Some would argue that Sri Lanka fell into a Chinese debt
trap, pointing to 2017, when China took over a 99-year lease
on Hambantota port after the country was unable to repay
debt secured against it.
The share of foreign debt owed to China is small at
around 10%, though, while foreign capital market debt
makes up almost half.
The Asian financial crisis of 1997–98 taught sovereigns
to build up their foreign reserves and develop deep local
currency funding markets. Sri Lanka, in contrast, took too
much foreign debt, even raising US dollars onshore, and
paid little attention to its maturity schedule.
While the government was trying to keep foreign
creditors happy, ordinary Sri Lankans endured hardships.
In January, the government dug into its foreign reserves to
repay a US$500m bond maturity, then found it did not have
enough hard currency to import medicine.
Instead of heading back to the IMF when its problems
International Financing Review Asia April 16 2022 1
OPINION INTERNATIONAL FINANCING REVIEW ASIA
first became clear, Sri Lanka did not admit defeat until its
foreign currency coffers were almost empty. That leaves its
financial and legal advisers, who haven’t even been selected
yet, with little room to manoeuvre.
Sri Lanka does not need to worry about its default causing
a crisis. The crisis has been underway for years.
Lock stock
I
ndonesia’s GoTo Group scored a surprising success on its
listing debut – one which might make Asian regulators
rethink lock-up periods.
The ride-hailing and e-commerce provider priced its
Rp13.7trn (US$957m) IPO at a steep valuation that looked
excessive compared with tech stocks in the US and Asia.
But the shares traded up 18% on the first day and were still
above the offering price by the end of the week.
Indonesia imposes a two-year lock-up on shares with
multiple voting rights, and GoTo is the first company to list
there with that kind of shareholding structure.
Longer anchor holding periods than the six-month
term common across most of Asia could be a way for tech
founders to show their commitment to meeting ambitious
targets like turning a profit. It could also provide some
comfort for IPO investors who will be assured that insiders
still have skin in the game.
India is moving in the same direction. Payments company
Paytm’s share price cratered 7.8% on December 15, the day
the one-month lock-up on anchor investors expired. Within
two weeks India’s stock market regulator introduced a new
rule requiring IPO anchors to hold on to half of their stakes
for 90 days.
Still, long lock-ups won’t support share prices by
themselves, and Paytm had begun tanking on its first day of
trading.
Shanghai’s tech-heavy Star board also has a two-year
holding period for strategic investors, but that didn’t stop
shares in Vanchip (Tianjin) Technology plunging 45% on
their trading debut on Tuesday.
GoTo’s strong early performance is more likely to be
down to its market-leading position, small free float and
strong retail interest, with 300,000 investors participating
in the IPO. It has even been highlighting its new listing in
YouTube commercials, while publicising a discount on the
rides it offers.
Conditions onshore are good, too, with Bank Indonesia
pledging to hold its policy rates at record lows and the stock
market trending up.
Lock-ups are a positive step to ensure IPOs are driven by
long-term investors instead of fast money, but they won’t
support prices if the broader market thinks the shares are
overvalued.
INTERNATIONAL FINANCING REVIEW ASIA INDEX

African Development Bank 17 Credit Agricole 31 Kimberly Mineral Sands 19 Rentenbank 17

AI Lenarco Midco 26
APT Pipelines 18
Artisan Acquisition 25
Ascendas REIT 11, 31
Ascott Residence Trust 11, 31
Athene Global Funding 17
Australian Office of Financial
Management 17
Australian Venue 18
Avellino Lab USA 34
Ayala 30
Bajaj Finance 8
Bank of East Asia 20, 23
Battersea Power Station 29
Beijing Enterprises Holdings 22
Beneunder 23
Biba Fashion 27
Blibli 4
Bluestone 17
Centuria Capital No 2 Fund 17
Chailease International Financial
Services (Singapore) 31
Chailease International Leasing 34
Cheng Loong 34
China Citic Bank International 20
China Resources Microelectronics 24
China Zheshang Bank Foshan branch 21
Chrysos 20
CIFI Holdings (Group) 23
Destone Acquisition 23
Dowell Service Group 23
Dr Peng Holding Hong Kong 22
E-House (China) Enterprise Holdings 24
Element Materials Technology 32
Employees Provident Fund
of Malaysia 30
EnergyAustralia Holdings 19
Eslite Spectrum 34
ESR India Investment Holdings 26
Feutune Light Acquisition 23
Filinvest Land 30
Foresight Solar Fund 19
Foshan Gaoming Construction
Investment Group 21
Full Truck Alliance 11
Ganzhou Development Investment
Holding Group 21
GIP Sharon Finco 18
GoTo Group 4
GP Industries 32
Helios Investments Australia 19
Hong Kong Special Administrative
Region 7
IGO 18
IGT Solutions 10
Indian Railway Finance Corp 8, 26
Indonesia Asahan Aluminium 27
iQiyi 11
KKR 28 Republic of the Philippines 5
Korea Midland Power 33 Roma Central 32
Korea Mine Rehabilitation and SBI Cards & Payment Services 8
Mineral Resources 33
SEG Automotive Germany 22
Korea Water Resources Corp 33
Seijo Ishii 29
Leo Paper Group 24
Sembcorp Industries 11, 31
Life Insurance Corporation of India 27
Shimao Group Holdings 22
Longfor Intelligent Living 22
Shinshin Credit 34
Longreach 20
Shriram Transport Finance 8, 26
LX Technology 23
Sumitomo Joint Electric Power 9, 29
Mars Investment Holdings 24
Sunac China 21
Mars US HoldCo 24
Tencent Music Entertainment 11
Medco Energi Internasional 27
TNB Power Generation 29
Megmilk Snow Brand 9
Tokyo Century Leasing (Singapore) 32
Merdeka Copper Gold 27
Towngas Smart Energy 20, 24
Milano Central 32
Traveloka 4
Miniso Group 10
True Move H Universal
Mirae Asset Securities 33
Communication 35
Mitsubishi Motors 9
UPL 26
Mitsubishi UFJ Financial Group 28
Verona Central 32
MotorOne Bidco 19
Vietnam Prosperity Joint Stock
New Zealand King Salmon Commercial Bank 35
Investments 30
VXI Global Solutions 24
Oakey 1 20
Waskita Karya 27
Obayashi 9
West Kowloon Cultural
Orix 28 District Authority 24
Park24 29 Yiwu State-owned Capital Operation 21
Pegadaian 27 Yunnan Provincial Energy
Ping An Real Estate Capital 22 Investment Group 6

Citic Securities International 20 Japan Oil Gas & Metals National Corp 29 Precinct Properties New Zealand 30 Zhenro Properties Group 21
CPOF Finance 19 JERA 29 Prenetics 25 Zhihu 10

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2 International Financing Review Asia April 16 2022

Contents
INTERNATIONAL FINANCING REVIEW ASIA
April 16 2022 ISSUE 1232

TOP NEWS STORIES COUNTRY REPORT

EQUITIES
04 GoTo debut inspires IPO hopefuls 17 AUSTRALIA
Tech company’s performance surprises
sceptics after offering was expensively priced
20 CHINA

BONDS 23 HONG KONG

05 Philippines debuts ESG Samurai
Asian sovereign achieves good demand for
sustainability bonds and prints longest tenor 26 INDIA

27 INDONESIA
BONDS
06 LGFV sells double ESG bond
Chinese energy company’s green and SLB 28 JAPAN
labels help deal draw demand in rocky market

29 MALAYSIA
BONDS
07 Hong Kong outlines green future
SAR electrifies sovereign retail ESG bond 30 NEW ZEALAND
market with enlarged debut deal
30 PHILIPPINES
08 BONDS RBI sends Indian yields surging
09 LOANS Sustainable loans soar in Japan 31 SINGAPORE
10 EQUITIES HK rules make homecomings hard
10 LOANS BPEA strikes again with IGT LBO
11 BONDS Singapore Inc wears green sheen
33 SOUTH KOREA

PEOPLE & MARKETS 34 TAIWAN

RESTRUCTURING
12 Sri Lanka calls in the cavalry
35 THAILAND
Country signals Asia’s first sovereign
default in decades
35 VIETNAM
13 MARKETS Ex-Goldman banker convicted in 1MDB case
14 IN BRIEF Japan’s Securities and Exchange Surveillance Commission has filed further 14 Reg S
charges against SMBC Nikko Securities
16 WHO’S MOVING WHERE? Citigroup has appointed its Hong Kong and Macau CEO Angel
Ng to run Asia Pacific global wealth management

International Financing Review Asia April 16 2022 3

News New bond recipe from Yunnan 06  HK goes big on green bonds 07  RBI causes yield spike 08

GoTo debut inspires IPO hopefuls

Equities Tech company’s performance surprises sceptics after offering was expensively priced
„ 

By S ANURADHA increasingly looking launch tech IPOs as they Energy Solution (US$10.7bn)
unattractive and GoTo’s listing understand the sector better,” and China’s Jinko Solar
GOTO GROUP’s stronger-than- gives some hope to issuers,” the ECM banker said. (US$1.6bn).
expected stockmarket debut said a Singapore-based ECM Foreigners have been buying However, scepticism over
is likely to encourage more banker. “We are just hoping the GoTo shares since the listing GoTo has not completely
technology issuers to tap the debut gains are sustained.” as the company is likely to be disappeared given the post-listing
Indonesian equity market, The sharp correction in the added to the benchmark Jakarta performance of Indonesian
despite weak conditions e-commerce company
elsewhere. Bukalapak. It debuted 24% higher
The shares of the ride-hailing “The US market is increasingly looking in August last year after an
to e-commerce company on unattractive and GoTo’s listing gives some upsized IPO, but is now down
Monday rose 18% on their first hope to issuers. We are just hoping the debut 61% from the Rp850 issue price.
trading day to Rp382 from the gains are sustained.” Insiders have not yet begun
issue price of Rp338. As the selling, since there is a two-year
week wore on, they gave back lock-up on GoTo’s multiple
about half of the gains to stand technology sector in the US Stock Exchange Liquidity 45 voting rights shares (Series B)
at Rp376 on Friday afternoon, since late 2021 and increased Index and Indonesia Stock and an eight-month lock-up on
still up 11%. scrutiny of special purpose Exchange 30 Index by the end the pre-IPO Series A shares as
A buoyant local stock acquisition companies is of the month. The IPO was sold per regulatory requirements.
market, optimism over GoTo’s dissuading Asian issuers from only to local investors. The transaction is the first
growth prospects and a lock-up listing in the US either through in Indonesia to be launched
for existing shareholders a standalone IPO or a merger SCEPTICISM REMAINS under the multiple voting
contributed to the strong with a blank-cheque company. The GoTo IPO, the third-largest rights scheme approved by
performance, which surprised Indonesia is also an in Asia this year, is one of the regulator last year. Around
market participants as the appealing destination for the few issues to have gone 40.6bn series A shares were
Rp13.7trn (US$957m) domestic investors as it is South-East through recently as Russia’s sold in the IPO.
IPO was richly valued. Asia’s best performing stock invasion of Ukraine and There was huge retail
The terms valued the market this year, with gains of expensive valuations have demand for the listing: GoTo
company at 17 times forecast 9.9%. “Foreigners have started weighed on market conditions. said around 300,000 investors
2023 revenues, while regional showing interest in Indonesia Asia’s two biggest IPOs this participated in the offering, the
and global mobility and and this is a good time to year are from South Korea’s LG highest number for an IPO on
e-commerce companies
generally trade in a 2.6–4.4
range.
GoTo’s secondary
performance compared
favourably with that of South-
East Asian rival Grab, which
fell 21% on its US debut in
December, and Indian payment
company Paytm, which
tumbled 27% on its first day of
trading in November.
Bankers expect GoTo’s IPO
to encourage other potential
Indonesian issuers. E-commerce
company BLIBLI, formally
called Global Digital Niaga, is
planning a local IPO of around
US$1bn in the second half,
while online travel portal
TRAVELOKA is expected to sell
a domestic IPO of US$300m–
$500m, though the timing is
not clear.
“The US market is

4 International Financing Review Asia April 16 2022


Japan’s sustainable loans 09  Zhihu squeaks through 10  BPEA’s Indian unitranche 10
the Indonesia Stock Exchange.
The company allocated
US$20m of shares to driver-
partners under its Gotong
Royong (mutual cooperation,
in Bahasa Indonesia) share
programme.
GoTo CEO Andre Soelistyo
said investor interest was
Philippines debuts ESG Samurai
Bonds Asian sovereign achieves good demand for sustainability bonds and prints longest tenor
„  volatile, we didn’t have the
By TAKAHIRO OKAMOTO
The REPUBLIC OF THE PHILIPPINES
raised ¥70.1bn (US$559m) from
the first sustainability Samurai
bond offering, but had a hard
time winning over investors
for its longest-dated yen issue
so far.
It became the second
sovereign to issue an
environmental, social and
governance-labelled bond in
Japan, after Hungary sold green
bonds in 2020 and in February
this year.
The Philippine deal
comprised four tranches. A
¥52bn five-year tranche priced
with a 0.76% coupon, a ¥5bn
seven-year portion priced
with a 0.95% coupon, a ¥7.1bn
10-year piece priced with a
1.22% coupon, and a ¥6bn 20-
year bond priced with a 1.83%
coupon. The respective spreads
over Tonar mid-swaps are 60bp,
70bp, 85bp and 115bp. All
tranches will be issued at par.
The South-East Asian
sovereign started marketing on
April 7 with respective initial
price guidance of 55bp–60bp,
65bp–70bp, 80bp–85bp and
115bp–120bp and continued
marketing with the same
guidance ranges on the
following day. The guidance was
finalised on Monday at 60bp,
70bp, 85bp and 117bp. The 20-
year tranche priced 2bp inside
the final guidance, an unusual
occurrence in the yen market.
The issuer initially marketed
a 15-year note at 95bp–100bp
strong despite global market
volatility, “reflecting the rapidly
growing demand in South-
East Asia for our on-demand,
e-commerce and financial
technology services”.
The issuer, which was born
from the merger of ride-hailing
firm Gojek and e-commerce
over, but dropped it on Monday.
“Amid market volatility and
rising geopolitical tensions,
this landmark Samurai
transaction has demonstrated
the Republic’s ability to price
tighter than current secondary
levels and extend the maturity
to the long end of the curve,”
Being the first sustainability Samurai bond
helped attract demand from mega-banks,
life insurers, trust banks, asset management
firms, regional accounts, other accounts and
foreign investors.
said National Treasurer Rosalia
De Leon in a statement. “The
upsized transaction supported
by new investors from Japanese
regional banks and life
insurance companies highlights
the Republic’s strong credit
profile in the global capital
markets.”
The Samurai deal came after
the country issued a US$2.25bn
bond in March and before
the presidential election next
month.
NOTABLE ACHIEVEMENTS
Bankers on the deal pointed to
three achievements.
Being the first sustainability
Samurai bond helped attract
demand from mega-banks,
life insurers, trust banks, asset
management firms, regional
accounts, other accounts and
foreign investors. Allocations
for each tranche were
undisclosed.
International Financing Review Asia April 16 2022 5
company Tokopedia in May last
year, is also planning to sell
up to 10% of its capital in a US
listing later this year.
Under Indonesian regulations
it has two more years to
increase the free-float on the
local exchange to 7.5%.
Proceeds from the IPO will
This was also the Philippines’
first 20-year bond sale in Japan,
beating its previous longest
maturity of 10 years.
Thirdly, the sovereign raised
a decent amount without
issuing a three-year tranche.
Usually, in the selective
Samurai market, sovereign
issuers need to include a short
maturity tranche to cater to
demand.
Bankers away from the deal
were not so impressed. One
said there was a lack of strong
demand in the long-dated
tranches even though the issuer
paid extra premiums over its
US dollar secondary market
curve. He said sentiment
was not as strong as it was in
January.
The guidance ranges referred
more closely to the secondary
trading levels of the issuer’s
existing Samurai bonds and
the pricing terms of Hungary’s
February deal than to the
Philippines’ US dollar curve.
INVESTOR CAUTION
One big domestic investor
said that, although he found
the ESG deal interesting, he
decided not to participate
this time because of the still
For daily news stories
visit www.ifre.com
be used for working capital
purposes.
Indo Premier Sekuritas, Mandiri
Sekuritas and Trimegah Sekuritas
were the bookrunners.
Alibaba Group, SoftBank
Vision Fund and Singapore’s
GIC are among the investors in
the company. 
elevated volatility in the
domestic market.
“As the market is still
courage to buy,” he said. “But
market sentiment is definitely
better than in March, so we
would invest more in credits
for a short-term investment
horizon if sentiment continues
to improve.” He stressed
the “short-term investment
horizon” because it is hard
to hold for six months to one
year amid US rate increase
expectations.
The process of hiring
banks for the deal was not
straightforward. Sources said
SMBC Nikko was initially hired
as a sole lead manager, but the
issuer had to hire another bank,
Mitsubishi UFJ Morgan Stanley,
as some domestic investors
did not want to place orders
with Nikko after the bank was
charged last month for alleged
stock market manipulation.
Usually, lead managers
evenly underwrite cross-border
yen deals, but on this trade
MUMSS underwrote 30% and
Nikko 70% of each tranche as
the latter played a leading role.
The deal is rated Baa2/
BBB+/A– (Moody’s/S&P/JCR).
Proceeds raised from
this offering under the
Philippines’ sustainability
finance framework will be
used for projects aligned with
International Capital Market
Association’s green and social
bond principles, ASEAN green
bond standards and/or the
Loan Market Association’s
green/social loan principles.
Vigeo Eiris provided a
second party opinion on the
framework. 
News
LGFV sells double ESG bond
Bonds Chinese energy company’s green and SLB labels help deal draw demand in rocky market
„ 

By MORGAN DAVIS in March 2021 from Austrian a green deal or SLB trade done would like to use the double-
electricity company Verbund, without needing another ESG structure to amplify their
YUNNAN PROVINCIAL ENERGY which sold a €500m (US$545m) label, said Luying Gan, head transition plan and strategy.”
INVESTMENT GROUP became the 20-year note with a green of sustainable bonds for debt Gan believes the use of a dual
first Asian issuer to sell an use of proceeds and a step-up capital markets in Asia Pacific label allowed the issuer to sell
international bond with both pegged to its goal of increasing at HSBC, and the amount of an international bond in an
green and sustainability- renewable energy capacity. work required can deter them otherwise difficult market, and
linked status, helping it attract The idea is that the combined from pursuing a second label. attract international investor
interest in a challenging interest, something that is rare
market. for a Chinese LGFV deal.
Despite some caution
The idea is that the combined structure allows The green participation was
from investors, the Chinese the notes to more easily fall into dedicated green still limited to three or four
hydropower, thermal and investment funds than a straight SLB. Some investors, as the three-year
alternative energy company investors are still uncomfortable with the SLB tenor was too short for some
priced its US$230m 5.3% three- step-up structure, since investors benefit from a international green investors
year bond on Wednesday at and others were priced out of
borrower’s failure to meet its green goals.
99.454 to yield 5.5%, inside the deal. The short tenor also
initial guidance of 6% area. compresses the time frame for
The order book reached just structure allows the notes to But the structure works well the SLB, leaving the issuer less
US$410m, including US$210m more easily fall into dedicated for borrowers like Yunnan than two years to meet its KPIs
from the leads, when the final green investment funds than Provincial Energy, which has and just one coupon payment
price guidance was announced. a straight SLB. Some investors fossil fuel exposure and needs before maturity to pay the
Final deal statistics were not are still uncomfortable with to communicate its transition step-up should the KPIs not be
released. the SLB step-up structure, strategy. met.
The final price reflects fair since investors benefit from a “There could be investor “We hope this is a structure
value, said a banker on the borrower’s failure to meet its concerns about how they are that would be replicable by
transaction. Investor feedback green goals. embarking on the transition other issuers as well,” said
had ranged from the low-5% Many issuers can get either journey,” said Gan. “The issuer Gan, adding that it will help
to high-5% areas, with some
investors adjusting their price
thoughts during the day due to
choppy market conditions.
Proceeds will be used to
refinance offshore debt that
is related to green projects,
while the sustainability-linked
aspect gives the notes a coupon
step-up if the issuer misses
targets to increase its wind
and solar power generation
capacity.
The coupon will step up
by 15bp if the company does
not increase wind generation
capacity by 173% by December
2023, compared with a
benchmark at the end of 2021,
and by 10bp if it does not
increase solar power by 43%
within the same timeframe.
The reporting date is June
30 2024, with the interest
payment going into effect on
October 22 2024.
Yunnan Provincial Energy
is not the first to combine the
green and sustainability-linked
structures into one deal. The
first widely marketed deal came

6 International Financing Review Asia April 16 2022

 For daily news stories
visit www.ifre.com

borrowers that are otherwise
working on transition plans
to communicate them to the
market.
A sustainability banker away
from the Yunnan Provincial
Energy trade said that the
structure is interesting, but
will not be suitable for many
issuers.
“I just don’t see why you
need to come to the market
with both commitments,” said
the sustainability banker. She
reckoned that the borrower
may have been trying for a
“bullet-proof trade” given that
its tenor is short and changes
to its energy transition will be
limited in just three years. The
doubling up may demonstrate a
real commitment to transition
for investors, she said.
Yunnan Provincial Energy
faced some additional hurdles
with investors. The company
is more than 90% indirectly
owned by the Yunnan State-
owned Assets Supervision and
Administration Commission, so
some buyers saw the name as
a local government financing
vehicle, while others saw it as a
state-owned enterprise.
The company is the sole
provincial energy vehicle in
China’s southern province of
Yunnan, which has weaker
financial strength than many
other provinces.
HSBC, Guotai Junan
International and Industrial Bank
Hong Kong branch were global
coordinators. They were also
the bookrunners and lead
managers with China Industrial
Capital Corp, CLSA and Hua Xia
Bank Hong Kong branch. HSBC
was the sole green structuring
bank.
Bank of East Asia was
dropped from the bookrunner
list during the day.
Yunnan Energy Investment
Overseas Financial Co will
issue the Reg S notes with a
guarantee by Yunnan Provincial
Energy. The notes will be rated
BBB– by Fitch in line with the
guarantor. 

Hong Kong outlines green future yield enhancement features

Bonds SAR electrifies sovereign retail ESG bond market with enlarged debut deal
„  – failed to attract significant
By JULIAN LEWIS
The HONG KONG SPECIAL
ADMINISTRATIVE REGION is to turbo-
charge the sovereign retail
green bond market, shrugging
off both the UK’s feeble sales
of a similar instrument and
February’s pandemic-driven
postponement of its own deal
by unveiling revised plans for
a huge debut “Bond with a
Green Future” offering of up to
HK$20bn (US$2.55bn).
The three-year new issue is
set to go on sale to individual
investors in the Chinese-
controlled territory soon.
“Given the epidemic situation
is gradually subsided, we will
relaunch the issuance shortly,”
financial secretary Paul Chan
wrote in an official blog.
The deal will combine the
HK$6bn (US$750m) that the
government sought to raise in
February with some or all the
volume allocated to the product
in the new financial year which
began on April 1.
Its initial size will be
HK$15bn (US$1.9bn), Chan
said. This could rise as high
as HK$20bn depending on
demand.
The inflation-linked deal’s
2% floor has also been raised
to 2.5% to reflect “the hiking
interest rate environment”.
This structure mimics Hong
Kong’s non-green “iBond” and
“Silver Bond” retail bonds. They
or inflation linkage and no
defined marketing timetable
demand.
are also three-year instruments Kong) are co-arrangers. Sales via the government-
with floored inflation-linked The SAR’s pioneering of owned National Investments
payouts based on the SAR’s sovereign retail green bonds and Savings reached only
composite consumer price reflects both its issuance £300m (US$394m) in the six
index, calculated from the track record and its policy months from launch in the
government’s household stance. It is already an active run-up to the UK hosting the
expenditure survey – though institutional green bond issuer COP26 international climate
only the former is tradeable in euros, renminbi and US summit in Glasgow last
like the listed “Bond with a dollars. It upped its green November.
Green Future”. programme to HK$200bn in “The green market is a
new environment for NS&I,”
a spokesman said. “Since we
The SAR’s pioneering of sovereign retail green launched green savings bonds
bonds reflects both its issuance track record in October 2021, we have
and its policy stance. It is already an active been understanding customer
behaviour and the balance
institutional green bond issuer in euros, renminbi between the interest rate and
and US dollars. It upped its green programme to the attraction to savers of the
HK$200bn in the 2021–22 budget early last year. environmental benefits that
investing in this product will
deliver.”
All pay the higher of the the 2021–22 budget early last Both in its size and its
floor rate and the average of year. structure, Hong Kong’s deal is
the index’s six most recent Under its green bond more like another sovereign
monthly year-on-year rates of framework, proceeds of both retail ESG bond series. Italy has
change. institutional and retail issues raised over €20bn (US$22bn)
It is unclear if the new go to the SAR’s Capital Works across four issues of its “BTP
green offering will retain the Reserve Fund “to finance or Futura” product, which
planned two-week subscription refinance green projects that supports national recovery
period or extend this in view provide environmental benefits from the Covid-19 crisis.
of the significant increase and support the sustainable Besides a step-up coupon, the
in size. But combining deals development of Hong Kong”. deals pay holders a premium of
after the severity of Hong 1%–3% at maturity, depending
Kong’s fifth Covid-19 wave UK CONTRAST on the country’s GDP growth
forced the inaugural deal’s The deal comes in notable over the life of the bonds.
postponement in late February contrast to the UK’s “Green The Hong Kong deal’s link
“could save issuance cost and Savings Bonds”. The first to consumer prices also sets a
administrative work and allow sovereign green bonds targeted precedent for France’s coming
greater timing flexibility for to individual investors, the institutional green inflation-
the later issuance of iBond and product – a non-tradeable linker – set to be one of 2022’s
Silver Bond”, Chan wrote. plain vanilla instrument key transactions for the green
HSBC and Bank of China (Hong priced flat to Gilts and with no bond and SSA markets. 

International Financing Review Asia April 16 2022 7

News
RBI sends Indian yields surging
Bonds Liquidity-absorbing operation and rising inflation herald further rate increases
„ 
By KRISHNA MERCHANT
Bond yields spiked in the
rupee market last week
after the Reserve Bank of
India introduced a new cash-
absorbing tool to soak up
excess liquidity from the
financial system amid higher
inflation risks.
Corporate bond yields in the
rupee market followed the surge
in three-year, five-year, and 10-
year government benchmarks,
whose yields climbed 35bp,
50bp and 34bp to 6.1%, 6.67%
and 7.24%, respectively,
after the central bank policy
announcement on April 8,
according to Refinitiv data.
The RBI introduced the
Standing Deposit Facility
to borrow money from
commercial banks at a rate of
3.75%, higher than the 3.35%
reverse repo rate.
“Eligible participants can
place deposits with the RBI
on an overnight basis at the
fixed rate. The RBI, however,
retains the flexibility to absorb
liquidity for longer tenors
under the SDF with appropriate
pricing, as and when the need
arises,” the central bank said in
a release.
Prior to the policy change,
short-term yields were hovering
at multi-year lows due to a
liquidity overhang of around
Rs8.5trn (US$111bn) in the
financial system.
“The RBI will engage in
a gradual and calibrated
withdrawal of this liquidity
over a multi-year time frame
in a non-disruptive manner
beginning this year,” the
central bank added.
Market participants said that
the RBI had given a hawkish
signal by setting a higher rate
to drain liquidity.
“The new SDF has blunted
the effectiveness of the reverse
repo rate,” said Shilan Shah of
Capital Economics in a note. “In
essence, the rate corridor has
narrowed by 40bp, resulting in
8 International Financing Review Asia April 16 2022
a slight tightening of monetary
conditions.”
INFLATION WORRIES
In its policy announcement,
the central bank revised the
inflation forecast upwards to
5.7% from 4.5% earlier for the
current financial year ending
next March and prioritised
“There is a mismatch between pricing
expectations of the issuers and investors. The
demand is tepid; issuers will have to settle at
higher levels for the demand to come back.”
the fight against inflation over
economic growth.
Annual consumer prices
surged to a 17-month high
of 6.95% in March, exceeding
market forecasts of 6.35%, due
to higher crude prices as India
imports over two-thirds of its
oil, according to official data
published on Tuesday.
Analysts expect early rate
increases after inflation
exceeded expectations.
“We see elevated risk that
rate hikes could be even more
front-loaded, with a 50bp
hike in one of the meetings
INDIAN GOVERNMENT 10-YEAR YIELD JUMPS AS RBI SOAKS UP LIQUIDITY
7.25
7.20
7.15
7.10
7.05
7.00
6.95
6.90
6.85
4 Apr 5 Apr 6 Apr
Source: Refinitiv
in 2022,” said Nomura Global
Markets Research in a note on
April 13.
Bond issuers in the domestic
market are keeping their plans
on hold due to the volatility in
yields.
“There is a mismatch
between pricing expectations
of the issuers and investors,”
said Murthy Nagarajan, head
of fixed income at Tata Mutual
Fund. “The demand is tepid;
issuers will have to settle at
higher levels for the demand to
come back.”
AAA rated public sector
companies were able to
issue long-tenor bonds below
government yields due to
elevated demand from pension
and provident funds before the
fiscal year ended on March 31.
However, investment activity
from pension and provident
funds tends to be slow in the
early part of the new financial
7 Apr 8 Apr 9 Apr
year, so AAA rated issuers
planning to issue in April
will have to adapt their price
expectations.
“We could see a 40bp–50bp
yield reset for such issuers
compared to the March
levels,” said Venkatakrishnan
Srinivasan, bond market
veteran and founder of
Rockfort Fincap, a financial
services company.
Even before the RBI policy
announcement, BAJAJ FINANCE,
SBI CARDS & PAYMENT SERVICES
and INDIAN RAILWAY FINANCE CORP
scrapped plans to raise 10-
year bonds, while others are
taking a different approach to
fundraising.
“Only issuers which are
in desperate need of funds
will test the bond market,”
said Srinivasan. “They may
explore floating-rate formats as
investors demand protection
when yields are rising.”
For instance, SHRIRAM
TRANSPORT FINANCE is targeting up
to Rs7bn from two-year floating
rate bonds.
“Corporates may tap loans
as borrowing in the capital
market becomes expensive,”
Tata Mutual Fund’s Nagarajan
said. 
10 Apr 11 Apr 12 Apr 13 Apr
 For daily news stories
visit www.ifre.com

Sustainable loans soar in Japan the first such loan from the
manufacturing sector, and the
company is planning another
Loans Green and ESG financings rise to their highest level in the first quarter
„  ¥10bn 10-year loan this year.
Last September, shipping
By WAKAKO SATO become compliant with the sustainability-linked loan, company Kawasaki Kisen closed
Task Force on Climate-related attracting 34 lenders in general a ¥110bn five-year transition-
Japan’s sustainable financing Financial Disclosures, said syndication. linked loan, the country’s
market is thriving with Goda. Being TCFD-compliant Elsewhere, dairy products largest such financing.
environmental, social and is a requirement under the maker MEGMILK SNOW BRAND With a greater number of
governance-related loan BoJ’s climate change mitigation completed a ¥8bn six-year SLL financiers vying for sustainable
volumes rising to their highest scheme, which offers lenders in with nine prefectural banking financings, some lenders are
quarterly tally in the first three Japan long-term loans at zero federations of agricultural finding themselves being
months of 2022 and prospects interest for on-lending through cooperatives joining arranger scaled back on oversubscribed
looking bright this year. green and sustainability-linked Norinchukin Trust & Banking. loans, while the rising pool of
ESG loans more than doubled loans and bonds. The new “I believe our presence as a liquidity is expected to lead to
to US$6.46bn in the first scheme was launched in the lead lowered hurdles for the tighter pricing.
quarter from US$2.79bn in the second half of last year and will
same period last year, with the run until fiscal 2030.
number of deals also jumping Goda said that currently
“The market has not reached the point of
to 36 from 16, according to only a third of Japan’s regional greenium but if the deal flow rises and the
Refinitiv LPC data. banks are TCFD-compliant. pressure on ESG increases, more people will
The market for such want to invest in such products and there is no
financings is expected to get BIGGER AND WIDER doubt that the pricing will become tighter.”
a boost from this month, as A slew of ESG loans completed
the Bank of Japan scales back last month shows how the
its Covid-19 loan operations market is growing in terms of JA Shinnoren [agricultural ”Sustainable lending
offering zero interest rates individual loan sizes as well as cooperative] banks, which were activities are gradually picking
prior to discontinuing it in scale. considering participating in up in Japan and there is a
September. “Covid-19 crisis funding ESG loans, and as a result, the growing awareness, which I
The hope is that more was an urgent issue last year, syndication group expanded,” expect will accelerate,” said
domestic lenders will seek but this year more and more said Hiroshi Akutagawa, senior Koji Tanaka, director of solution
to obtain cheap credit by borrowers are accelerating manager of the food and products division at MUFG.
accessing an ESG funding their sustainability efforts,” agribusiness planning division “Both deal flow and market
window that the central bank said Tomoko Hirabayashi, joint at Norinchukin Bank. distribution volumes are
launched last year with the aim general manager of syndicated The bank, which serves over increasing. The market has not
of taking Japan closer towards finance at Mizuho Bank. “In 5,000 agricultural, fishing and reached the point of greenium
its goal of becoming carbon- terms of market sentiment, forestry cooperatives, aims to but if the deal flow rises and
neutral by 2050. we were often asked about the provide ¥10trn in sustainable the pressure on ESG increases,
“As the BoJ’s Covid-19 loan merits of doing sustainable finance by 2030. more people will want to invest
operations offering zero financing last year, but now in such products and there is
TRANSITION PUSH no doubt that the pricing will
Japan’s transition finance become tighter.”
“In terms of market sentiment, we were often market, which aims to prompt The effect on pricing is not
asked about the merits of doing sustainable high-emission industries to the most pressing issue for
financing last year, but now we are in a decarbonise, took off a year ago lenders in Japan, which has
and is expected to grow further seen its loan market shrink
situation where we have no choice but to this year with the Ministry of due to the impact of Covid-
work on it, and I feel that the borrowers are Economy, Trade and Industry 19. Overall syndicated loan
becoming more active than ever before.” having kickstarted sector volumes in Japan dropped to
roadmaps. US$50.189bn via 485 deals
The state-owned Development in the first quarter of 2022,
interest rate are phasing out we are in a situation where we Bank of Japan, one of the most a 44.5% decrease compared
going forward, more lenders have no choice but to work on active sustainable financing to the same period last year
could be willing to participate it, and I feel that the borrowers lenders, established a transition as pandemic-related funding
in its green operations,” said are becoming more active than business promotion office on needs diminished.
Munehiro Goda, senior vice ever before.” April 1 to enhance its transition Sustainable financings, on
president in the sustainable MITSUBISHI MOTORS completed business, and Norinchukin the other hand, recorded a
business promotion department a ¥121.5bn (US$1bn) one- Bank also said it aims to arrange significant increase, accounting
at Sumitomo Mitsui Banking year positive impact finance transition loans. for a 12.9% share of overall
Corp. loan, Japan’s largest such In March, SUMITOMO JOINT lending in the first three
BoJ’s climate change borrowing. Tokyo-listed ELECTRIC POWER, a unit of months of 2022 compared with
scheme will pick up steam construction company OBAYASHI Sumitomo Chemical, signed a 3.1% in the same period last
as more Japanese banks signed a ¥70bn five-year debut ¥8bn nine-year transition loan, year. 

International Financing Review Asia April 16 2022 9

News
HK rules make homecomings hard
Equities Market cap and innovation requirements for companies with dual-class shares create hurdles
„ 
By FIONA LAU
The homecoming trend of
US-listed Chinese companies
continues with NYSE-listed
ZHIHU being the latest to join the
queue, but Hong Kong’s dual-
class share rules have added
challenges to the transactions.
Shareholders of Chinese
question-and-answer website
Zhihu are set to raise HK$834m
(US$106m) from a Hong Kong
dual primary listing after the
offering of 26m secondary
ordinary shares, or 8.2% of total
shares outstanding, priced at
HK$32.06 per share.
Zhihu opted for a dual
primary listing in Hong Kong
instead of a secondary listing,
as the latter requires a good
track record of at least two
financial years of regulatory
compliance on another
BPEA strikes again with IGT LBO
Loans Sponsor is raising one of the largest unitranche financings from India
„  BPEA EVERYWHERE
By PRAKASH CHAKRAVARTI,
MIRZAAN JAMWAL
Baring Private Equity Asia is
raising US$350m through a
unitranche financing for its
leveraged buyout of specialist
business process outsourcing
firm IGT SOLUTIONS, marking one
of the largest such loans from
India.
Barclays, Canada Pension Plan
Investment Board, KKR Credit,
Nomura, Ontario Municipal
Employees’ Retirement System and
Hong Kong-based Tor Investment
Management are the lenders on
the six-year bullet financing.
A few institutional investors
are being targeted in a limited
sell-down for the financing,
which carries a leverage multiple
of slightly over 6x and all-in
pricing of 650bp over SOFR.
Proceeds will fund BPEA’s
LBO of IGT, formerly known as
InterGlobe Technologies, for
10 International Financing Review Asia April 16 2022
qualifying exchange.
The company raised
US$523m from a NYSE IPO in
March 2021 at US$9.50 a share.
As a company with a
weighted voting rights
structure, Zhihu needs to meet
certain market capitalisation
requirements in Hong Kong.
Local listing rules require
companies with a WVR
structure to have a market cap
of at least HK$40bn (US$5.1bn)
at the time of listing, or a
market cap of at least HK$10bn
at the time of listing and
revenue of at least HK$1bn
for the most recent audited
financial year.
“The market cap
requirements are not too
difficult to meet when markets
are good. But the risk of being
delisted by the US regulators
over auditing issues and
around US$800m. Financial
close of the LBO is expected in
a couple of months.
BPEA is buying IGT from
Aion Capital Partners, an
affiliate of Apollo Global
Management. Aion had
acquired IGT from InterGlobe
Enterprises, the owner of
India’s IndiGo Airlines, in 2019.
Aion funded that LBO with
a US$100m five-year term loan
with a leverage multiple of
2.5x–3.0x.
The leverage multiple on
IGT’s borrowing is close to
the levels transacted for other
unitranches in India last year,
but the size of the borrowing
is significantly larger. Last
July, KKR raised a US$165m
unitranche with leverage of
5.5x–6.0x to fund its buyout of
Vini Cosmetics, while Advent
International raised US$100m
with gearing of 6x for its
acquisition of a controlling
Chinese regulators’ crackdown
on technology companies
have hammered US-listed
Chinese shares, making some
of them struggle to meet the
requirements,” said an ECM
banker.
“Some smaller US-listed
companies which are eager to
come back to Hong Kong will
have to wait until their share
prices recover,” said the banker.
Zhihu barely met the
threshold, after its NYSE
shares fell 78% in the past six
months. Its market cap stood
at US$1.4bn (HK$11bn) on
Tuesday, while its revenue was
Rmb2.96bn (HK$3.64bn) in
2021.
TECH ONLY
Hong Kong also only allows
companies with innovation and
growth characteristics to adopt
stake in Zandu Chemicals.
Last October, BPEA also
completed a US$500m
unitranche for its LBO of BPO
company Straive, the largest
such loan from Asia outside of
Japan and Australasia. CPPIB
and Nomura underwrote that
5.5-year bullet borrowing with
a leverage multiple of 6.5x–7.0x
and all-in pricing of 6.5%–7%,
and sold down some of it to
other investors.
Straive, which started life in
1980 as Philippines-based SPi
Global, is now headquartered
in Singapore and derives
a significant portion of its
revenues from India.
IGT’s unitranche shows
the product is gaining appeal
in Asia Pacific. Last month
Japanese conglomerate
SoftBank Group raised a
US$5.1bn unitranche loan
from PE giant Apollo Global
Management and a group of
the dual-class structure. Some
US-listed non-tech Chinese
companies, such as budget
store chain MINISO GROUP, need to
work around this restriction to
seek a homecoming listing.
NYSE-listed Miniso has filed
for a dual primary listing in
Hong Kong which could raise
about US$100m–$200m. Bank of
America, Haitong International and
UBS are sponsors.
Under a WVR structure,
Miniso’s founder Ye Guofu and
his wife Yang Yunyun own
a combined 64.4% stake in
the company but have voting
power of 76.8%. The company
plans to unwind the structure
upon the Hong Kong listing, it
said in a listing filing.
“Miniso is not very confident
that it will get a waiver from
the Stock Exchange of Hong
Kong on its WVR structure as
co-investors in what was the
largest such financing globally.
BPEA’s financing for IGT’s LBO
is among a slew of different
types of leveraged loans it has
tapped in recent months.
Last month it launched a
US$120m five-year loan for
Indian cash logistics company
CMS Info Systems. The loan
pays a top-level all-in pricing of
341.77bp based on an interest
margin of 325bp over SOFR,
leverage of around 3.25x Ebitda
and an average life of 4.77 years.
BPEA and Ginko
International’s major
shareholders have launched a
US$639.60m-equivalent five-
year leveraged loan for the
planned management buyout
of Taiwan’s largest contact
lens maker. The financing
offers a top-level all-in pricing
of 340.40bp and 215.40bp for
the US and NT dollar facilities
based on opening margins of
325bp over term SOFR and
200bp over Taibor. Net leverage
is 5.0x–5.5x.

it’s not a technology company,
so they decided to unwind it,”
said a person with knowledge
of the matter.
Miniso raised US$608m
from a NSYE IPO in October
2020 at US$20 per share. The
stock closed at US$7.82 on
Tuesday for a market cap of
US$2.36bn.
Bankers are hoping Hong
Kong’s regulators could relax
the dual-class rules to facilitate
homecoming listings. Other
US-listed Chinese companies
with WVR structures that are
planning to list in Hong Kong
include freight-as-a-service
provider FULL TRUCK ALLIANCE,
video platform IQIYI and TENCENT
MUSIC ENTERTAINMENT.
For Zhihu’s Hong Kong
listing, Innovation Works,
Qiming, SAIF and Capital Today
are the selling shareholders.
The shares will start trading on
April 22.
Credit Suisse, JP Morgan, CICC
and CMB International are the
sponsors. 
In February, BPEA raised
a US$760m term loan B for
its LBO of business services
provider Tricor Group. The
seven-year first-lien term loan
priced at a margin of 400bp
over SOFR plus a credit spread
adjustment, a 0.5% floor and
a 99 original issue discount.
Along with a pre-placed
US$260m eight-year second-
lien term loan, the borrowing
represented the largest TLB
from Hong Kong.
The same month BPEA
mandated nine banks for a
US$386m loan that will refinance
a borrowing closed in 2019 to
support the LBO of healthcare
technology firm CitiusTech. The
loan pays an opening interest
margin of 400bp over term SOFR
and represents leverage of 5.5x
Ebitda.
Last year BPEA raised a
couple of leveraged loans in
India for the healthcare services
division of Hinduja Global
Solutions and Coforge (formerly
known as NIIT Technologies),
both of which met with good
receptions from banks. 
For daily news stories
visit www.ifre.com
Singapore Inc wears green sheen
Bonds More local currency sustainability-linked bonds are expected this year
„ 
By KIT YIN BOEY last week as issuers rapidly the green and sustainability-
launched deals that had been linked notes, with some larger
A flurry of Singapore dollar stalled in the first quarter, orders seen from European and
deals amounting to S$708m when rate volatility caused a Hong Kong-based investors who
(US$523m) last week saw more large gap between the pricing have mandates for ESG-related
local corporates take on green expectations of investors and investments, said the DCM
and sustainability-linked labels. issuers. The annual financial banker.
ASCENDAS REIT sold S$208m reporting season also caused a The additional demand
of seven-year senior green delay. helped with some price
bonds priced on Monday at “It is market dynamics at compression and will
3.46% via sole lead OCBC, play here,” said one DCM encourage other issuers with
which was followed by ASCOTT banker. “The issuers saw how ESG goals.
“I expect more SLBs to
be sold by Singapore-based
“It is market dynamics at play here. The corporates than green bonds
issuers saw how recent deals were successfully as the latter are constrained
completed and were well received by investors, by the specific use of proceeds
so they are quickly taking advantage of the and not many companies have
window ahead of an impending rise in rates projects that meet the green
standards,” said another DCM
and rising cost of funds.”
banker.
OCBC credit analysts said
RESIDENCE TRUST’s S$200m recent deals were successfully the market was well supported
print of inaugural five-year completed and were well by significant new issue
sustainability-linked notes sold received by investors, so they concessions, providing more
at 3.6% on Tuesday via sole lead are quickly taking advantage value than existing issues. That
DBS. of the window ahead of an suggested that issuers had
SEMBCORP INDUSTRIES then impending rise in rates and finally given in to investors
offered a S$300m seven-year rising cost of funds.” on providing higher pricing to
SLB that priced on Wednesday A syndicate banker said the mitigate the effects of rising
at 3.735% through joint leads Singapore dollar market is rates in the future.
DBS, OCBC and UOB. expected to slow down soon Recent deals have yielded
The only other green bond in the run-up to the next US NICs of 10bp to as much as
sold so far this year was from Federal Reserve meeting on 30bp, but the concessions also
statutory agency Housing and May 3–4, when a 50bp rate take into account the premium
Development Board, which increase is widely expected to investors are demanding as a
made its green debut in early be announced. buffer against future rate hikes
March with a S$1bn 1.84% “The Singaporean issuers are and duration extensions.
five-year note. First REIT trying to get out now to get the “It is quite hard to really say
Management issued a S$100m funds before there is any more what is the pure NIC and what
five-year CGIF-guaranteed social volatility,” said the syndicate investors want for duration
bond at 3.2% at end-March. banker. risks in this environment amid
Bankers said the green and The ESG tinge also helped a flattening of the rate curve,”
SLB transactions came grouped broaden investor demand for said a credit analyst. 
PLEASE CONTACT US IF YOU HAVE
INFORMATION ABOUT JOB MOVES
AT YOUR FIRM OR WITHIN THE MARKET
Call +852 3853 4352
or email peoplemarkets@refinitiv.com
International Financing Review Asia April 16 2022 11
 People
& Markets
TOP STORY RESTRUCTURING
Sri Lanka calls in the cavalry
Country signals Asia’s first sovereign default in decades
The DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA
will become the first sovereign in Asia to
default since Pakistan in 1999 after it said
it would stop servicing its foreign debt
from April 12 and seek support from the
International Monetary Fund that would
involve restructuring its liabilities.
Sri Lanka has a US$1bn 5.875% bond
maturing on July 25, which slid from 51
cents in the dollar to 45 on Wednesday,
according to Refinitiv data. Many had
expected the country not to pay a
US$500m maturity in January but it did
so after securing bilateral loans from
neighbouring countries.
Coupons on a US$1.25bn 5.75% bond
maturing April 2023 and a US$1.25bn
6.75% bond maturing April 2028 are
due on April 18. Both bonds were
trading at around 39 cents in the dollar,
as confirmation came through that
payments on the US$12.6bn of foreign
bonds would be suspended.
“We expect the government to miss
paying these coupons, and therefore
lowered our foreign currency sovereign
ratings on Sri Lanka to ‘CC’,” said S&P on
Wednesday. This reflected “the virtual
certainty of a default on some affected
obligations”. On the same day, Fitch
downgraded the country to C from CC.
Three days before the decision to
default, requests for proposals to hire
financial and legal advisers were sent
out by the ministry of finance. The
deadline for submission is April 16 and
appointments are expected after the
April 18–24 IMF and World Bank spring
meetings in Washington.
“The country asks for financial advisers
then it defaults. That’s leaving it rather
late,” said one restructuring adviser.
A bondholder said the capitulation was
for the best. “The government seemed
to view defaulting as equivalent to
economic collapse. The alternative to not
restructuring has already been playing
out and has been too painful for the
country,” he said.
Richard Briggs, an investment manager
at GAM, said: “They should have pre-
emptively restructured one or two years
ago but now they are going to have to do
it anyway, but from a far worse position.”
At the end of March, Sri Lanka had
12 International Financing Review Asia April 16 2022
just under US$2bn of foreign exchange
reserves, meaning it was unable to secure
vital supplies if it kept servicing its debts,
estimated at US$25bn in all. The country
said it would be seeking assistance from
other multilateral and bilateral lenders as
well as the IMF.
The ministry of finance said all debt in
non-Sri Lankan rupee currencies and not
written in domestic law would be treated
under any restructuring, excluding swap
lines agreed between the central bank
and other central banks. Sri Lanka has
“They should have come to this decision a long time
ago and it would have made sense if they had already
engaged the bondholders prior to this. Sri Lanka has lots
of sets of creditors and getting them all under one head
[of agreement] will be tough.”
relied on these lately to meet crucial
expenses.
The scope includes debt guaranteed
by the state and issued by state-owned
enterprises, such as SRI LANKAN AIRLINES,
which has a US$175m 7% 2024 bond
outstanding, bid at 38.6 cents in the
dollar. Bilateral loans from other states
are included in addition to foreign bonds.
‘BRUTAL’ RESTRUCTURING
A second restructuring adviser said the
scope, capturing virtually all Sri Lanka’s
government-linked debt, “was wider
than anticipated. It has surprised even
those in the public sector.” He said the
restructuring could be “brutal”.
He noted that debt already stood at
110% of GDP at the end of 2021 and
was likely to be higher now, after the
depreciation of the rupee, maybe as high
as around 200%. The rupee has lost 54%
year to date, making it the world’s worst-
performing currency.
Sri Lanka did not qualify for the Group
of 20’s debt service suspension initiative
that helped the world’s poorest 70 or so
countries during the pandemic. Some
in this category, such as Zambia, have
sought to restructure their debts using
the G20’s common framework.
That requires that bilateral and other
official sector debts are treated first
before private sector debts, which must
then receive comparable treatment.
“Officially they don’t qualify for the
common framework but using it on an ad
hoc basis could be very useful and some
official sector people are very much in
favour,” said the second adviser.
Other advisers said the question of how
to tackle the bilateral loans Sri Lanka
has recently taken out from neighbours
such as India would definitely have to
be discussed. If they were ring-fenced
that might upset bondholders and other
creditors.
“Some people had warned them not
to take out soft loans when they were
desperate,” said a third adviser. “The
former central bank governor will have
a lot of problems explaining why that
was a good strategy. At least the day of
reckoning is now here. It’s never too
late to get advice.” Former central bank
governor Ajith Nivard Cabraal submitted
his resignation on April 4 as president
Gotabaya Rajapaksa sought to form a
unity government.
A fourth restructuring adviser agreed.
“They should have come to this decision
a long time ago and it would have made
sense if they had already engaged the
bondholders prior to this. Sri Lanka has
lots of sets of creditors and getting them
all under one head [of agreement] will be
tough.”
He said the lack of transparency on the
bilateral facilities was also a potential
problem. “A lot of the details of the
bilateral loan facilities with China are
not made public so we don’t know how
difficult the inter-creditor issues will be,”
he said.
The ministry said the pandemic, which

has decimated vital tourism revenues,
combined with the war in Ukraine had
hurt the country’s fiscal position so that
“continued normal servicing of external
public debt obligations has become
impossible”.
The bonds had been trading at
distressed levels since travel restrictions
first came in at the start of the pandemic
in March 2020. Last month, the IMF
said Sri Lanka’s debt was unsustainable,
prompting the government to
acknowledge a restructuring of its
external debt was necessary.
Finance minister Ali Sabry said Sri
Lanka needed US$3bn within the next six
months to manage a crippled economy.
Ex-Goldman
banker convicted
in 1MDB case
(Reuters) Former Goldman Sachs banker
Roger Ng was convicted by a US jury on
April 8 of corruption charges related
to his role in helping loot hundreds of
millions of dollars from Malaysia’s 1MDB
development fund.
The charges stemmed from one of
the biggest financial scandals in history.
Prosecutors charged Ng, Goldman’s
former top investment banker for
Malaysia, for conspiring to violate an anti-
corruption law and launder money.
They said he helped his former boss
Tim Leissner embezzle money from the
fund, launder the proceeds and bribe
officials to win business for Goldman.
Ng, 49, had pleaded not guilty to
the charges. His lawyers say Leissner,
who pleaded guilty to similar charges
in 2018 and agreed to cooperate with
the prosecutors’ investigation, falsely
implicated Ng in the hopes of receiving a
lenient sentence.
The fund was founded to pursue
development projects in the South-East
Asian country.
The jury convicted Ng of two counts
of conspiracy to violate the Foreign
Corrupt Practices Act through bribery
and circumvention of Goldman’s internal
accounting controls, as well as one
count of conspiracy to commit money
laundering.
“Today’s verdict is a victory for not only
Prolonged power cuts and acute shortages
of essential products have sparked huge
street protests, putting Rajapaksa under
pressure.
“I am sceptical this administration can
stay the course,” said a fifth restructuring
adviser, suggesting that fresh advice
might be sought once a more credible
regime took power. “It all could have
been avoided. Are the same lot supposed
to fix the problems that they created in
the first place?”
Charles Robertson, global chief
economist at Renaissance Capital, was
not convinced a political upheaval will
make matters easier. “Disruptive political
changes … would make an agreement
the rule of law, but also for the people of
Malaysia,” Breon Peace, the US Attorney
for the Eastern District of New York, said
in a statement. “The defendant and his
cronies saw 1MDB not as an entity to do
good for the people of Malaysia, but as a
piggy bank to enrich themselves.”
Ng, wearing a black suit jacket and
black tie, showed little emotion as the
jury’s foreperson read out the verdict. Ng
glanced back and forth between the jury
and the desk he was seated at. His lawyer,
Marc Agnifilo, hung his head after the
guilty verdict to the first count was read.
US District Judge Margo Brodie, who is
“The defendant and his
cronies saw 1MDB not as
an entity to do good for the
people of Malaysia, but
as a piggy bank to enrich
themselves.”
overseeing the case, ordered that Ng be
subject to a curfew pending sentencing,
but said she did not consider him a flight
risk.
Deliberations began on April 5 after a
nearly two-month trial in federal court in
Brooklyn.
“HARD TO WIN”
Agnifilo said Ng may appeal, depending
on the outcome of his post-trial motions
and his sentence. He stood by his decision
to persuade Ng to waive extradition to
International Financing Review Asia April 16 2022 13
For daily news stories
visit www.ifre.com
on debt harder to achieve,” he said.
“The historic resistance to an IMF deal
means negotiations and programme
implementation could be difficult.”
S&P said it would lower its rating to
selective default once it was confirmed
coupons due on April 18 had been
skipped. “There are limited upside
scenarios to the ratings currently,” it said.
“Sri Lanka’s debt restructuring
process is likely to be complicated and
may take months to complete. Failure
to establish a sustainable government
could further complicate and hinder
progress in discussions with the IMF, and,
ultimately, delay a debt restructuring
plan.”
face trial, saying he had a better chance
of a fair trial in the United States than in
Malaysia.
“These big cases are tough and they’re
hard to win,” Agnifilo told reporters
including from Reuters.
Prosecutors have said Goldman helped
1MDB raise US$6.5bn through three bond
sales, but that US$4.5bn was diverted to
government officials, bankers and their
associates through bribes and kickbacks
between 2009 and 2015.
Ng is the first, and likely to be only,
person to face trial in the United States
over the scheme. Goldman in 2020 paid a
nearly US$3bn fine and its Malaysian unit
agreed to plead guilty.
Jurors heard nine days of testimony
from Leissner, who said he sent Ng
US$35m in kickbacks. Leissner said the
men agreed to tell banks a “cover story”
that the money was from a legitimate
business venture between their wives.
Ng’s wife, Hwee Bin Lim, later testified
for the defence that the business venture
was, in fact, legitimate. She said she
invested US$6m in the mid-2000s in a
Chinese company owned by the family
of Leissner’s then-wife, Judy Chan, and
that the US$35m was her return on that
investment.
Agnifilo said in his closing argument on
Monday that Leissner could not be trusted.
Alixandra Smith, a prosecutor, said in her
summation that Leissner’s testimony was
backed up by other evidence.
Jho Low, a Malaysian financier and
suspected mastermind of the scheme, was
indicted alongside Ng in 2018 but remains
at large.
LUC COHEN, JODY GODOY
 People
& Markets
IN BRIEF
SMBC Nikko Securities
SESC announces further charges
Japan’s Securities and Exchange Surveillance
Commission has filed further charges against
SMBC NIKKO SECURITIES, a former executive and
three of its employees over alleged market
manipulation.
The SESC, part of the Financial Services
Agency, alleges that the securities arm of
Sumitomo Mitsui Financial Group bought
five stocks – Jins Holdings, Toyota Boshoku,
Nippon Paint Holdings, Goldwin and Taisho
Pharmaceutical Holdings – to pump up their
price in order to make sure their block trade
deals went through.
Last month, the financial markets watchdog
announced charges against SMBC Nikko and
seven of its employees over alleged market
manipulation. Local media named vice president
Toshihiro Sato as one of the individuals charged.
SMBC Nikko could not be reached immediately
for comment, although it previously apologised
for its employees’ actions and pledged to work
with the financial watchdog to remedy the
matter.
MSCI
Korea eyes developed index inclusion
South Korea’s finance minister will lobby for the
country to be included in the MSCI developed
market index when he meets the index provider
this week, he said on Tuesday.
“Inclusion in the developed market index is
necessary and already overdue,” Hong Nam-ki
said at a news conference with foreign media in
Seoul.
Hong said the won – currently around 1,230 to
the US dollar – is at one of the weakest levels he
has ever seen and that the government is ready
14 International Financing Review Asia April 16 2022
to deploy market stabilising measures if needed.
Asia’s fourth largest economy is seeking
inclusion on an MSCI watchlist by June.
The absence of an offshore currency market for
the won has been one of the main obstacles
South Korea has faced in its efforts to be
promoted from the MSCI emerging market index
to the developed market.
The outgoing finance minister said some of the
measures on the table for discussion would be
extending trading hours and allowing overseas
FX dealers to participate in the market, but he
did not provide further details when asked.
Currently, onshore trading hours are 00:00 GMT
to 06:30 GMT and only locally licensed financial
institutions can participate.
Asked whether further opening up the USD/
KRW spot market could increase volatility at a
time when rising interest rates and the Russia-
Ukraine conflict are adding to uncertainties,
Hong said those are obstacles the country needs
to cope with.
“There are concerns over opening up the FX
market for 24 hours, but we will have to bear
what we have to,” Hong added.
The won’s one-month contract jumped to as
high as 1,227.4 per dollar in non-deliverable
forward trading immediately after Hong’s
comments were released at 0630 GMT,
strengthening 0.72% from its onshore spot
market close of 1,236.2. (Reuters)
China Securities Regulatory Commission
Investors should buy more stocks
China is encouraging long-term investors to buy
more equities and major shareholders of listed
firms to increase their holdings when stocks
slump, in a bid to stabilise a stock market rocked
by a worsening Covid-19 outbreak.
The government will also facilitate corporate
financing in Covid-hit areas and urge state
shareholders of listed firms to actively buy
undervalued stocks, China’s securities watchdog
said in a statement on its website late on
Monday.
China’s benchmark CSI300 index fell 3.1% on
Monday, the biggest drop in a month, as a
lockdown in Shanghai and other parts of the
country threatens economic growth.
The China Securities Regulatory Commission
said in the statement that authorities will
take steps to stabilise expectations of listed
companies and investors.
China will encourage social security funds,
pension funds, insurers, trust firms and wealth
management firms to allocate more money to
equity assets, and invest more in quality listed
companies, the CSRC added.
The government will also improve the financing
mechanism for private companies, and support
corporate fundraising, acquisitions and
restructurings in areas badly hit by Covid.
To boost investor confidence, CSRC said it will
encourage listed firms to buy back their shares
to stabilise prices. Major shareholders and
senior executives are also encouraged to actively
buy shares when prices fall sharply.
Meanwhile, state shareholders should actively
buy undervalued stocks, and support share
buyback and cash dividend plans by listed firms,
according to the statement, which was jointly
published by the CSRC, China’s state assets
supervisor, and the All-China Federation of
Industry and Commerce. (Reuters)
Reserve Bank of New Zealand
MPC surprises with 50bp hike
The Reserve Bank of New Zealand surprised the
markets by raising the official cash rate by a larger-
than-expected 50bp, to 1.5%, with most analysts
having predicted a 25bp increase at Wednesday’s
monetary policy committee meeting.

Though the committee still sees the cash rate
reaching 2.2% at the end of this year and a
cyclical peak of 3.35%, it decided that moving
the OCR to a more neutral stance sooner will
reduce the risks of rising inflation expectations.
“A larger move now also provides more policy
flexibility ahead in light of the highly uncertain
global economic environment,” according to
post-meeting statement.
“The level of global economic activity continues
to generate rising inflation pressures,
exacerbated by ongoing supply disruptions
in large part driven by Covid-19. The Russian
invasion of Ukraine has significantly added
to these supply disruptions, causing prices to
spike in internationally traded commodities and
energy,” the RBNZ noted.
The Bank highlighted domestic capacity
constraints and ongoing inflation pressures as
well as employment being above its maximum
sustainable level as labour shortages impact on
many businesses.
However, the Bank also emphasised growth
restraints caused by Covid, monetary tightening,
high geopolitical tensions and the related
economic sanctions on Russia.
Annual CPI accelerated from 4.9% in the third
quarter of 2021 to a three-decade high 5.9% in
Q4, further outside the reserve bank’s 1%–3%
medium-term target range, with the Q1 2022
report due on April 21.
“The committee will remain focused on ensuring
that current high consumer price inflation does
not become embedded into longer-term inflation
expectations,” the statement said.
After an initial knee-jerk spike the New Zealand
dollar lost ground following the rate hike, while
long-dated government bonds welcomed the
RBNZ’s proactive strategy with 10-year yields
dropping 10bp on Wednesday to 3.47%.
Axis Bank
ADB guarantee for supply chain finance
Indian private sector lender AXIS BANK has signed
a supply chain financing guarantee of up to
US$150m with the ASIAN DEVELOPMENT BANK.
The guarantee will make it easier for small and
medium-sized enterprises to participate in trade
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through environmental and socially sustainable
supply chains, the multilateral agency said in a
press release on April 8.
“This milestone project is ADB’s first supply
chain finance transaction in India, and we are
happy to partner with Axis Bank, which shares
similar values in promoting sustainable supply
chains in the region,” said Steven Beck, ADB’s
trade and supply chain finance head.
Backed by ADB’s Triple A credit rating, the
programme provides loans and guarantees to
more than 200 partner banks to support trade,
creating import and export opportunities for
enterprises across Asia and the Pacific.
Mitsubishi UFJ Financial Group
Green deposits launch
MITSUBISHI UFJ FINANCIAL GROUP has signed SYDNEY
AIRPORT as its first client for the launch of the
Japanese bank’s green deposits product in
Australia.
The green deposit carries tenors of one to
12 months and has been designed to help
commercial and corporate clients in meeting
their environmental objectives, MUFG said in a
media release on Monday.
Customers are able to place term deposits
with MUFG, which are in turn used to fund
qualifying green loans for projects such as
clean transportation, green buildings, energy
efficiency and sustainable water/wastewater
management projects, among others.
MUFG launched green deposits in the US in
February 2021 and is expected to roll out the
product worldwide in the near future.
MUFG has devised a green deposits framework
with support from Sustainalytics to ensure
alignment with industry practices and standards.
Legend Holdings
CSRC challenges information disclosures
China’s securities regulator on Thursday ordered
LEGEND HOLDINGS to rectify information disclosure
issues.
The China Securities Regulatory Commission
said in a statement that a regular on-site
inspection found that the company released its
International Financing Review Asia April 16 2022 15
For daily news stories
visit www.ifre.com
2020 annual report in Hong Kong earlier than it
did in mainland China.
Lenovo’s disclosure via the Shanghai Stock
Exchange of its acquisition of Banque
Internationale à Luxembourg also lagged its
announcement through the Hong Kong bourse,
it said.
The company also failed to disclose that shares
of some Legend subsidiaries were used as
collateral, while information involving non-
operational lending activities was not accurate.
(Reuters)
Gunma Bank
Gunma Bank sets up finance office
GUNMA BANK set up a specialised finance office
within its specialised finance and international
department on April 1, an official from the
Japanese regional bank told Refinitiv LPC in an
interview.
The office has a dozen team members, including
Kenji Takahashi as its head and two bankers in
charge of syndication.
The move is aimed at strengthening the bank’s
structured finance business, with the team
having responsibility for M&A, cross-border and
project financings.
Gunma aims to invest ¥1.5trn (US$11.96bn) in
sustainable financing in the next nine years and
expand its structured finance assets to ¥130bn
from ¥30bn in the next three years.
“We are particularly focusing on renewable
energy projects including offshore wind power
projects,” Junya Kosaka, general manager
of the specialised finance and international
department, said in the interview. “Having
said that, renewable energy projects are not as
profitable as leveraged buyout deals or other
projects, so in terms of profitability we may want
to increase these assets as well.”
Takahashi reports to Kosaka, who added
that Gunma would like to arrange LBOs and
renewable energy projects rather than just
participating in such financings.
“We are hoping to get involved in transactions
not just for local companies, but also in
financings such as private equity-sponsored
deals outside our area,” Kosaka said.
 People
& Markets
WHO’S MOVING WHERE...
„ CITIGROUP has appointed its Hong Kong and
Macau CEO Angel Ng to run Asia Pacific global
wealth management.
She will continue to be based in Hong Kong and
reports to Peter Babej, Asia Pacific CEO, and Jim
O’Donnell, CEO of global wealth management.
Ng joined Citigroup in 1998 and has held several
leadership positions across wealth management.
In 2015, she was appointed head of consumer
banking for Hong Kong and three years later was
named Hong Kong and Macau CEO.
„ HSBC has hired Elodie Norman as global co-
head of the institutional client group.
Norman will be co-head alongside Michael
Ellam and is a replacement for Simon Derrick,
who transferred to the markets and securities
services division in the fourth quarter of last
year. She is due to join HSBC in July and will be
based in Hong Kong.
Norman most recently headed up senior
relationship management in Asia Pacific ex-
Japan at Nomura. Prior to that, she was head
of the financial institutions group for Hong
Kong and insurance sector lead for Asia at
Australia and New Zealand Banking Group. She
previously worked at ING.
„ CREDIT SUISSE has hired Adam Reid as head
of metals and mining for Australia from RBC
Capital.
Reid was head of the global mining and metals
group in Australia at RBC Capital, where he
has spent the past twelve-and-a-half years.
He previously worked at BurnVoir Corporate
Finance, a boutique specialising in the energy
and infrastructure sectors.
He is effectively a replacement for Karl Rozman,
who joined Bank of America to run its natural
resources coverage in Australia around this time
last year.
„ Veteran banker Jun Palanca has resigned
from SUMITOMO MITSUI BANKING CORP after a stint of
over a dozen years with the Japanese bank.
Palanca was deputy general manager and head
of loans distribution for Asia Pacific ex-Japan
since August 2016.
His departure will be a big loss for SMBC as
he had a wealth of experience in Asian loan
markets and was instrumental in building the
Japanese bank’s loans distribution team since
taking over responsibility in 2016.
Palanca joined the Japanese bank as head of
structured finance syndications, and export and
agency and aviation finance in April 2010.
Before joining SMBC, Palanca worked with
Merrill Lynch, ING and Citigroup.
„ Valerie Ng has joined SUMITOMO MITSUI BANKING
CORP’s strategic products team in Singapore,
effective April 4.
She joins from JP Morgan, where she was part
of the portfolio management group for slightly
over three years. Prior to JP Morgan, Ng worked
at Mizuho Bank, OCBC Bank, First Gulf Bank
and Standard Chartered.
Ng reports to Pinky Duque-Ang, who was
appointed as head of the newly established
strategic products group for Asia Pacific ex-
Japan earlier this month.
„ MITSUBISHI UFJ FINANCIAL GROUP has appointed
Belinda Han to the newly created role of head of
transaction banking for Asia Pacific.
Based in Hong Kong, she reports to the head of
global transaction banking, Ranjana Clark, and
her appointment is effective immediately.
Han joined MUFG in 2020 and has served as
the head of transaction banking for East Asia.
Prior to that, she worked at Standard Chartered,
Deutsche Bank and HSBC.
„ Ivan Chan has joined CHINA CITIC BANK
INTERNATIONAL as senior director for structured
finance.
Based in Hong Kong, Chan will lead the real-
estate team in the bank’s structured finance
department.
He reports to Stockor Ng, deputy head of
structured finance.
Chan joined from United Overseas Bank where
he spent 4.5 years as director for debt capital
markets and mainly handled loans origination
and distribution for Greater China.
Previously, he worked for five years in DBS
Bank’s syndicated finance department and had
a three-year stint at HSBC.

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16 International Financing Review Asia April 16 2022


New Zealand 30 Philippines 30 Singapore 31 South Korea 33 Taiwan 34 Thailand 35 Vietnam 35
AUSTRALIA
DEBT CAPITAL MARKETS
›ATHENE MAKES KANGAROO DEBUT
ATHENE GLOBAL FUNDING,rated A+/A (S&P/
Fitch), debuted in the Kangaroo market on
Thursday, seven months after marketing
the proposed offering with joint lead
managers Bank of America, Deutsche Bank and
RBC Capital Markets.
The 4.76% A$300m (US$224m) April 21
2027s priced at par, in line with asset swaps
plus 190bp area guidance.
Athene Global Funding is a subsidiary
of Athene Annuity & Life Assurance and
is ultimately owned by the Bermuda-
based Athene Holding which itself
recently merged with the New York-
based investment manager Apollo Global
Management.
Australia resumes Treasury sales
„ Bonds Triple A status and yield pick-up underpin offshore demand for new 2033 benchmark
The AUSTRALIAN OFFICE OF FINANCIAL MANAGEMENT
(Aaa/AAA/AAA) encountered no difficulties
in executing its first syndicated nominal
bond sale in 12 months with a well-received
A$15bn (US$11.14bn) print of new November
21 2033 Treasury bonds via joint leads CBA,
NAB, Deutsche Bank and UBS.
Some A$37.5bn of final bids were received
for the bond which pays a 3% coupon and
priced at 98.647 to yield 3.14%. This placed it
within the minus 1.5bp to plus 1.5bp guidance
range at EFP (10-year futures) minus 0.5bp.
Paul O’Brien, executive director fixed-
income syndication at CBA, said the offering,
while coming against a challenging market
backdrop due to rising inflation and the
prospect of more central bank action globally,
had been well telegraphed by the AOFM,
allowing investors to position for participation
after the mandate announcement.
O’Brien also pointed to the absolute yield
pick-up available over US Treasuries as
an attractive proposition for relative value
offshore investors.
On Tuesday Australian Commonwealth
government 10-year benchmarks bonds
COUNTRY REPORT
Australia 17 China 20 Hong Kong 23 India 26 Indonesia 27 Japan 28 Malaysia 29
›RENTENBANK TAPS FOR A$100M
RENTENBANK, Germany’s government-
guaranteed agency for agribusiness (Aaa/
AAA/AAA), tapped its 3.2% May 2029
Kangaroo bond for A$100m on Wednesday,
taking the total outstanding size to A$550m.
The reopening, via sole lead manager TD
Securities, priced at 98.1 for a reoffer yield
of 3.505%, 39bp over asset swaps and 61bp
wide of the April 2029 ACGB.
›AFDB PRINTS SOCIAL KANGAROO
(Aaa/AAA/AAA) sold
AFRICAN DEVELOPMENT BANK
a A$155m 3.545% 10.5 year social Kangaroo
bond at par on Thursday, equivalent to
36bp over asset swaps and 55bp wide of the
November 2032 ACGB.
Daiwa was sole lead manager.
›CENTURIA RAISES A$30M
Centuria Funds Management, as trustee
of the unrated CENTURIA CAPITAL NO 2 FUND,
were yielding 3.08% versus 2.77% for 10-
year Treasuries, while 10-year JGBs, Bunds
and Gilts were offering respective returns of
0.24%, 0.81% and 1.85%.
Australia also benefits from its status
as one of only nine countries rated Triple
A by the three main western ratings
agencies, alongside Denmark, Germany,
the Netherlands, Luxembourg, Norway,
Singapore, Sweden and Switzerland, as well
as its generally acclaimed response to the
coronavirus outbreak.
Domestic investors bought 66.9% of the
November 2033s, Asia ex-Japan 12.5%, the
UK 9.3%, North America 7.8%, Europe 3.4%
and Japan 0.1%.
Fund managers took 34.6%, bank balance
sheets 21.2%, hedge funds 16.9%, bank
trading desks 15.7%, central banks 8.3% and
others 3.2%.
The previous nominal Australian federal
government syndicated bond sale was the
A$14bn issue of 1.75% November 21 2032s
on April 14 last year which secured a larger
A$48.1bn final order book before pricing to
yield 1.9%, 12.5bp wide of EFP.
International Financing Review Asia April 16 2022 17
raised A$30m from a short three-year
(March 2025) senior secured floating-rate
MTN offering, which priced in line with
guidance at six-month BBSW plus 335bp.
Westpac was arranger and sole lead
manager for Wednesday’s transaction that
had a minimum indicative size of A$25m.
STRUCTURED FINANCE
›BLUESTONE PLANTS SECOND PRIME RMBS
Non-bank lender BLUESTONE has mandated
CBA, ING, Macquarie and NAB to market
its second prime Australian dollar RMBS
offering.
Bluestone, which was acquired by
American private equity firm Cerberus
Capital Management in 2018, entered the
prime RMBS market in July last year via the
A$700m (US$532m) Bluestone Prime 2021-1
Trust which followed on from a strategic
partnership with Athena Home Loans
signed two months earlier.
In 2020, as the government responded
to the Covid-19 pandemic, the AOFM raised
A$116bn from seven syndicated nominal
Treasury bond issues, with maturities
ranging from 2024 out to 2051, including a
record-smashing A$25bn issue of new 0.5%
September 21 2026s.
Tuesday’s syndicated sale means
A$86.8bn has been raised out of this fiscal
year’s A$100bn target which was reduced
from A$105bn following the federal budget
on March 29 that benefited from higher-
than-anticipated commodity tax receipts.
After the budget the AOFM set a A$125bn
gross nominal bond funding target for 2022–
23, plus A$2.5bn in linker sales, and will
release more detailed guidance on issuance
plans for the first half of 2022–23 on July
1, including any planned new benchmarks.
Australia’s fiscal year starts in July.
The RBC Rates Strategy team expect
a new early H1 2034 bond to be issued
between July and the end of the calendar
year and possibly a new long-dated issue
with a 2043 or even 2053 maturity.
JOHN WEAVERS
 Bluestone, a regular issuer of non-
conforming RMBS, accessed this market for
a 32nd time in December with the no-grow
A$500m Bluestone Sapphire 2021-1 Trust.
The prime RMBS market remains
underpinned by the very small number of
mortgage arrears, which hit a record low
0.74% in December, down from 0.97% in
December 2020, according to S&P’s latest
RMBS Performance Watch: Australia.
“The resilience of household balance
sheets, bolstered by government stimulus
measures and low interest rates, has
enabled many borrowers to build up
repayment buffers, cure prior arrears
positions, and stay on top of their mortgage
repayments,” the report said.
“Strong property prices have also
enhanced refinancing options for many
borrowers by boosting equity positions in
their home loans”.
Mortgage interest rates are set to rise as
the Reserve Bank of Australia starts lifting the
official cash rate, possibly as early as June.
S&P believes the inclusion of interest-rate
buffers in debt-serviceability assessments
means most borrowers can withstand a
moderate level of interest rate increases,
though some will struggle with higher
mortgage repayment costs and general
inflationary pressures.
“This is likely to push up arrears in early
arrears categories as borrowers reprioritize
spending commitments to absorb higher,
non-discretionary expenses. Historically low
unemployment will temper the transition
from arrears to default for borrowers
experiencing financial stress,” S&P said.
SYNDICATED LOANS
›GIP LOAN DRAWS STRONG RESPONSE
A US$3.484bn seven-year term loan backing
Global Infrastructure Partners’ acquisition
of a stake in Pluto LNG Train 2 has closed to
a strong response.
Commitments were scaled back as a
result after 13 lenders joined in general
syndication.
The financial close is slated for April 26.
Bank of China, Banco Santander, Credit
Agricole CIB, MUFG, National Australia Bank,
Natixis, Sumitomo Mitsui Banking Corp, Societe
Generale and Standard Chartered were the
mandated lead arrangers, bookrunners and
coordinators of the syndication, which was
launched in January.
The other MLABs were ANZ, HSBC,
Industrial and Commercial Bank of China, Intesa
Sanpaolo, Korea Development Bank, Mizuho
Bank, NordLB, United Overseas Bank and
Westpac Banking Corp.
The loan offers an interest margin of
18 International Financing Review Asia April 16 2022
190bp during the construction phase of
approximately four years after the financial
close, before stepping down to 170bp after
the start of operations.
Prospective lenders were invited at four
ticket levels, with MLAs committing US$100m
receiving a participation fee of 100bp.
GIP SHARON FINCO is the borrower.
On November 15, Woodside Petroleum
agreed to sell a 49% non-operating
participating interest in the Pluto Train 2
joint venture to GIP.
Pluto Train 2 is a key component of the
proposed Scarborough development and
includes a new liquefied natural gas train
and domestic gas facilities to be constructed
at the existing Pluto LNG onshore facility.
The JV arrangements require GIP to
fund an additional amount of construction
capital expenditure of approximately
US$835m. If the total capex incurred is
less than US$5.6bn, GIP will pay Woodside
an additional amount equal to 49% of the
underspend. In the event of a cost overrun,
Woodside will fund up to US$835m in
respect of a 49% share of any overrun.
Following the completion, Woodside will
continue to hold 51% stake in the Pluto LNG
Train 2 JV and remain as its operator.
For full allocations, see www.ifre.com.
›IGO EYES LOAN FOR WESTERN AREAS BID
IGOis seeking a A$900m (US$670m) senior
secured three-year loan to fund its revised
bid for nickel producer Western Areas.
The borrowing comprises a A$540m
amortising loan and a A$360m revolving
credit facility, both maturing on April 30
2025, IGO said in its filing to the Australian
Securities Exchange on April 11.
ANZ, Commonwealth Bank of Australia and
Westpac Banking Corp are the underwriters.
IGO, formerly known as Independence
Group, is also planning to use A$570m in
cash to fund the revised acquisition.
On April 11, Western Areas agreed to a
revised takeover offer from IGO, valuing
the Australian nickel producer at A$1.26bn.
The revised offer of A$3.87 for every
Western Areas share is higher than the
previous offer of A$3.36 apiece.
Western Areas’ board of directors
unanimously recommended that
shareholders vote in favour of the
revised proposal after having initially
recommended the same for the A$3.36-per-
share deal.
Its view changed after an unprecedented
surge in nickel prices last month following
Russia’s invasion of Ukraine.
IGO said the revised offer recognises the
additional financial value generated by
Western Areas as a result of higher nickel
prices, as well as an improvement in nickel
price forecasts over the short and medium-
term.
The completion of the revised transaction
is targeted for June.
IGO’s financial adviser is Macquarie
Capital and Herbert Smith Freehills is its
legal adviser.
Rothschild and Goldman Sachs are
financial advisers to Western Areas, while
Ashurst is legal adviser.
›KKR-BACKED AVC EYES UNITRANCHE
AUSTRALIAN VENUE issounding out prospective
lenders for a A$605m loan for refinancing
and acquisitions.
The KKR & Co-backed hospitality group
is seeking a A$430m unitranche financing,
a A$100m capital expenditure facility and
a A$75m super senior revolving credit
facility.
The talks are at the early stage and
financing terms are subject to change.
AVC raised two A$50m 1.5-year revolvers
last March and June 2020, according to
Refinitiv LPC data.
In 2020, it cancelled a A$512m loan it
had put in place earlier to partially fund
its purchase of a portfolio of pubs in
Melbourne.
The five-year loan was split into A$40m
and A$95m revolving tranches, and term
loan portions of A$75m, A$115m, A$55m
and A$132m.
AVC’s name was changed from Dixon
Hospitality Group in mid-2017 when KKR
bought a majority stake.
A A$200m five-year loan funded the
buyout.
National Australia Bank and Natixis were
underwriters of that loan, which offered
opening interest margins of 325bp and
350bp over BBSY for the amortising and
bullet tranches, respectively, based on an
opening leverage multiple of over 3x Ebitda.
AVC operates more than 180 venues
across Australia and New Zealand.
›APA GROUP FIRES UP A$500M LOAN
Energy Infrastructure business APA Group
has launched a A$500m term loan into
general syndication.
The borrowing is split equally into five
and seven-year tranches with opening
interest margins of 115bp and 135bp over
BBSY, respectively.
ANZ and HSBC are the mandated lead
arrangers and bookrunners.
A presentation for prospective lenders is
scheduled for April 27.
APT PIPELINES, the funding vehicle for APA
Group, is rated Baa2/BBB (Moody’s/S&P).
The pricing of the five-year portion of the
latest term loan is identical to that of the

5.25-year tranche of a A$830m revolving
credit facility that APA extended in 2015.
ANZ, Commonwealth Bank of Australia,
National Australia Bank, MUFG Bank and
Westpac Banking Corp were MLABs of that
borrowing, which also comprised 2.25 and
3.25-year tranches with margins of 85bp
and 95bp respectively.
In May 2018, APA signed a A$1bn revolver
for refinancing and general corporate
purposes, according to Refinitiv LPC data.
The borrowing is split equally into
tranches maturing on June 30 2023 and
December 31 2023.
ANZ, Bank of Nova Scotia, BNP Paribas,
HSBC, Mizuho Bank, MUFG, NAB, OCBC,
Royal Bank of Canada, Sumitomo Mitsui
Banking Corp were the MLABs, while ABN
AMRO, Citigroup, China Construction Bank,
CBA, JPMorgan, Sumitomo Mitsui Trust
Bank and Westpac were MLAs.
In February, APA announced its agreement
to acquire all the senior secured loans from
Basslink, which entered into voluntary
administration and receivership last year.
APA was earlier in exclusive discussions
with owner Keppel Infrastructure Trust for
the potential acquisition of Basslink, which
later fell through.
›CPOF BUILDS A$300M REFI
Charter Hall Prime Office Fund has
launched a A$300m five-year revolving
credit facility into general syndication.
Sumitomo Mitsui Banking Corp is the sole
mandated lead arranger and bookrunner
for the loan, which is for refinancing.
CPOF FINANCE, the financing vehicle of
CPOF, is the borrower.
CPOF’s last visit to the syndicated loan
markets was in October 2019 when it raised
a A$300m six-year facility following an
impressive debut with a larger borrowing
in August that year.
The October 2019 loan, which was
for general corporate purposes, pays an
interest margin of 155bp over BBSY.
The debut A$500m seven-year unsecured
loan in August 2019 was increased from
an initial size of A$300m. It pays a margin
of 165bp over BBSY, based on the unlisted
fund’s BBB rating. SMBC was sole MLAB on
both of the 2019 loans.
CPOF has a A$8.6bn office portfolio,
according to its website.
›SHEFFIELD-YANSTEEL JV SECURES LOAN
Northern Australia Infrastructure Facility has
approved a loan of up to A$160m for a
mineral sands joint venture project in
Western Australia between Sheffield
Resources and YGH Australia Investment.
NAIF’s loan is part of a project financing
of approximately A$300m–$320m for
the Thunderbird mineral sands project,
Sheffield said in an ASX filing on April 14.
The first stage of the project has an
estimated funding requirement of A$484m.
NAIF’s loan as well as a A$40m cost
overrun facility are estimated to represent
a gearing ratio of approximately 60%,
Sheffield said in March.
Sheffield and Yansteel, the wholly owned
subsidiary of China’s Tangshan Yanshan
Iron & Steel, formed a 50-50 JV on the
project in January last year.
KIMBERLY MINERAL SANDS, the JV, is seeking
to complete the PF to fully fund the first
stage of construction with a third-party
commercial loan.
It has approached mining credit funds,
senior secured bond products and royalty/
streaming providers.
Naust Capital acted as PF adviser to
Kimberly Mineral Sands in relation to the
NAIF loan.
›ENERGYAUSTRALIA UPSIZES TO A$750M
ENERGYAUSTRALIA HOLDINGS has increased
its latest loan to A$750m from around
A$600m after a number of banks joined in
syndication.
Bank of China Hong Kong branch, China
Construction Bank, Commonwealth Bank of
Australia (agent), DBS Bank, Industrial and
Commercial Bank of China, HSBC, Mizuho Bank,
OCBC Bank, Royal Bank of Canada, Sumitomo
Mitsui Banking Corp and Westpac Banking Corp
were the lenders joining.
ANZ, BoC Sydney branch and National
Australia Bank were the mandated lead
arrangers and bookrunners of the
borrowing, which comprises three and five-
year tranches.
Hong Kong parent CLP Holdings is
contemplating offloading EnergyAustralia
and is working with a financial adviser on the
proposed divestment of the electric utility,
which could be valued at about US$2bn,
Bloomberg News reported in February, citing
people familiar with the matter.
The proposed divestment talks are at an
early stage and CLP may decide to keep the
business, the report said.
In the first half of 2021, EnergyAustralia
extended the maturities of a A$300m
working capital facility to June 2024
and a A$400m bank guarantee and
reimbursement facility by three years
to June and March 2024, respectively,
according to the interim results of CLP
Holdings in early August last year.
EnergyAustralia aims to diversify its
debt portfolio through green and energy
transition financing to meet the needs of
clean energy projects, including battery
storage and green hydrogen, CLP said.
International Financing Review Asia April 16 2022 19
COUNTRY REPORT AUSTRALIA
›QUANTEM BULK CLOSES REFI
Quantem Bulk Liquid Storage & Handling
has completed a A$517m refinancing.
The refinancing comprises a five-year
term loan, capital expenditure and working
capital facilities, Quantem said in an
announcement.
Canadian Imperial Bank of Commerce, DNB,
ING Bank, MUFG, National Australia Bank and
Sumitomo Mitsui Banking Corp were the lenders.
HELIOS INVESTMENTS AUSTRALIA is the
borrowing entity. Acton Advisory, PMC
Treasury and Allens advised Quantem.
In December 2019, ANZ Terminals
acquired Graincorp Liquid Terminals
(Australia), the Australian terminals
business of Graincorp. The combined
business was rebranded to Quantem.
A A$457.5m five-year loan backed the
acquisition of ANZ Terminals in December
2019, according to Refinitiv LPC data.
ABN AMRO, MUFG, NAB and SMBC were
mandated lead arrangers and bookrunners.
Korea Development Bank joined as an MLA,
while CIBC came in as a participant.
Quantem is an independent provider of
liquid storage terminals across Australia
and New Zealand.
›QUADRANT DRIVES IN MOTORONE REFI
Quadrant Private Equity has raised a
A$223m loan to refinance aftermarket car
products and services provider MotorOne.
Westpac Banking Corp was the sole
mandated lead arranger and bookrunner of
the loan, which matures in November 2025.
Aware Super, Metrics Credit Partners, Siemens
and Victoria Funds Management joined in
syndication.
In August 2016, the private equity firm
acquired a majority stake in MotorOne,
formerly known as WorldMark Group
Holdings, alongside the founders and
management.
A month earlier, MOTORONE BIDCO signed
a A$146.3m loan, which comprised term
loans of A$40.75m and A$75.55m and
revolving credit facilities of A$20m and
A$10m, according to Refinitiv LPC data.
Westpac was also the MLAB of that
borrowing, which matured last August.
Commonwealth Bank of Australia and
Metrics Credit Partners were participants.
›FORESIGHT SOLAR AGREES ON REFI LOAN
FORESIGHT SOLAR FUND has obtained a loan of
about A$60m to refinance its portfolio of
two solar farms in Australia.
ANZ and Deutsche Bank are providing a term
loan of approximately A$59m and a debt
service reserve facility of about A$1m, Foresight
Solar said in a news release on April 11.
 The refinancing is for the OAKEY 1 and
LONGREACH solar farms in Australia’s
Queensland state and the portfolio will
predominantly be hedged up to 10 years.
The assets had senior loans from MUFG
and Australia’s Clean Energy Finance Corp
maturing in April this year.
Foresight Solar, which invests in a
diversified portfolio of ground-based solar
photovoltaic and battery storage assets in
the UK and internationally, said the pricing
of the latest refinancing has improved the
terms compared with the existing loans.
In January, Foresight Solar acquired the
remaining 51% interest in the Oakey 1 and
Longreach solar farms from Canadian Solar.
It acquired a 49% stake in each farm in
December 2017.
EQUITY CAPITAL MARKETS
›BOOKS COVERED FOR CHRYSOS IPO
Gold testing technology provider CHRYSOS
has completed the institutional tranche
Citic Securities International prints debut
„ Bonds Market volatility stunts book growth after long wait for right window
CITIC SECURITIES INTERNATIONAL grasped the short
window before the Federal Reserve’s next
meeting in May to raise US$300m from a
maiden bond deal.
The 3.375% senior Reg S bonds were
priced at 99.65 to yield 3.499%. This was
equivalent to 90bp over Treasuries, inside
initial price guidance of 125bp area.
CSI decided to come to the market on
Tuesday after monitoring conditions for a
long time, said bankers on the transaction.
After a few quiet weeks, April 11 saw a
handful of mandates announced, including
TOWNGAS SMART ENERGY and BANK OF EAST ASIA,
which the issuer viewed as a sign that the
window was open.
A banker from a Chinese lender said that
CSI took its chance with investors ahead of
the Fed’s meeting in early May, when another
interest rate rise or balance sheet reduction is
expected to be announced.
“They decided to focus on the short end of
the curve,” said another banker on the trade.
“A lot of the Chinese FIGs are issuing five-
year, but investors’ preference is three-year.”
A third banker said CSI was a strong
credit, but the bookbuilding process was
challenging because of the choppy market
conditions.
“The rates were up and the [US] CPI
20 International Financing Review Asia April 16 2022
of its A$180m (US$134m) ASX IPO.
The books were covered at launch,
according to the people close to the deal.
The deal comprised A$65m of
primary shares and A$115m of secondary
shares at a fixed price of A$6.50 each. The
term-sheet did not indicate the split between
the retail and institutional tranches.
The issue price represents a market
capitalisation of A$637m and an enterprise
value of A$535m.
The selling shareholders include
Australian mining contractor Perenti Global
for up to 7.1m shares.
The retail tranche will run from April
26–29. Listing is scheduled on May 6.
Founded in 2016, the company is a
metal mining service support provider
that provides photon assay technology
to analyse concentrations of gold, silver
and complementary elements in samples.
It raised A$50m in a pre-IPO round in
September 2021.
Proceeds will be used for capital
expenditure.
Barrenjoey is the lead manager.
data was announced, so those have caused
market volatility,” said the third banker. “The
order book was less than I expected.”
Orders peaked at US$1.2bn when the final
price guidance was announced, including
US$865m from the joint lead managers. The
final deal statistics were not disclosed.
Although the deal was oversubscribed, the
borrower decided to keep it at only US$300m
in order to focus on quality investors, said the
Chinese banker.
Bookrunners saw fair value at 90bp, after
gauging investor interest on Monday and
determining that CICC HK was the closest
comparable. CICC HK, an offshore entity of
China International Capital Corp, was trading
at a G-spread of 93bp when CSI was out.
Some investors also looked at Shenwan
Hongyuan Securities and Huatai Securities,
which were trading tighter around 75bp. But
the third banker said that since the bond
was issued through CSI rather than the head
office like Shenwan and Huatai, it made CICC
HK the closest comparable.
CreditSights and Nomura analysts
estimated higher fair value of 100bp and
105bp respectively.
The heavily anchored deal, which was not
expected to be very liquid, was trading 8bp
to 10bp wider in the secondary market on
CHINA
DEBT CAPITAL MARKETS
›CITIC BANK INTERNATIONAL PRINTS AT1
has raised
CHINA CITIC BANK INTERNATIONAL
US$600m from an Additional Tier 1 bond.
The Basel III-compliant perpetual non-call
five-year notes were priced at par to yield
4.8%, or Treasuries plus 210.4bp. The coupon
will be reset at the same spread over the
then-prevailing Treasuries on the first call
date and every five years thereafter.
The initial price guidance was set at the
5.125% area.
Analysts at Nomura estimated fair value
around 4.7%–4.8%. CreditSights saw fair
value at 4.85%, including some new issue
premium.
The orders reached US$2.15bn, including
US$1.185bn from the leads, when the final
price guidance was announced.
Wednesday.
CSI MTN, a wholly owned special purpose
vehicle of CSI, is the issuer of the notes, while
the parent has provided a guarantee.
Hong Kong-headquartered CSI is in turn
a wholly owned subsidiary of Citic Securities.
The borrower is also the holding company of
CLSA.
CSI’s total assets stood at US$32.6bn
at the end of last year, or 16.2% of the Citic
Securities group’s total assets. CreditSights
analysts views CSI as a core subsidiary of the
parent.
The bonds will be rated BBB+ by S&P, in
line with the guarantor.
CLSA, ICBC, Bank of China, Bank
of Communications, China Citic Bank
International, Citigroup and HSBC were joint
global coordinators. They were also joint lead
managers and bookrunners with Industrial
Bank HK, CMB Wing Lung Bank, SPDB, ABC,
CNCB Capital, Mizuho Securities, JP Morgan,
Standard Chartered Bank, China Minsheng
Banking, CCB Asia, Nanyang Commercial
Bank, China Everbright Bank and Yue Xiu
Securities.
The proceeds from the Hong Kong-listed
trade will be used for working capital, general
working purposes and refinancing.
PAN YUE

The final book stood at US$1.36bn from
52 accounts, including US$755m from
the leads. The entire deal was allocated to
Asian investors. Asset managers and fund
managers took 42%, corporates 29%, banks
and financial institutions 20%, and private
banks and institutional investors 9%.
The Reg S AT1s will be rated Ba2 by
Moody’s. Citic is rated A3/BBB+ (Moody’s/
Fitch).
CreditSights’ analysts raised concerns
over the bank’s relatively weak core equity
Tier 1 ratio and its lack of disclosures on
its non-Hong Kong assets. The report added
that Citic’s capital ratios have been among
the lowest across banks in Hong Kong,
which could lead to rating downgrades.
China Citic Bank International, Citigroup,
CNCB Capital and CLSA were the joint global
coordinators, as well as joint bookrunners
and lead managers.
ABC International, Bank of Communications,
Bank of East Asia, BNP Paribas, BoCom
International, CCB International, CCB Asia,
China Everbright Bank HK, China Galaxy
International, China International Capital
Corp, China Minsheng Banking HK, China
Securities International, Chiyu Banking, Chong
Hing Bank, CMB International, CMB Wing
Lung Bank, CMBC Capital, CSFG, GF Securities,
Haitong International, Huatai International,
ICBC International, Industrial Bank HK, Mizuho
Securities, Nanyang Commercial Bank, SPDB HK,
SMBC Nikko, SPDB International and UBS were
also bookrunners and lead managers.
Zhenro, Sunac fail to make payments
„ Bonds Default on offshore debt is latest to hit China’s property sector
ZHENRO PROPERTIES GROUP has defaulted on two
US dollar-denominated bonds, it announced
in a stock exchange filing last week.
The developer was supposed to pay
US$8.35m for its US$200m 8.35% 2024
bonds and US$12.07m for its US$340m 7.1%
2024 notes. The company had a 30-day
grace period to make the payment, which
was initially due on March 10.
In the filing, Zhenro blamed the Covid
lockdown in Shanghai, saying that some of
its operations have been halted in recent
weeks and its liquidity has been constrained.
As the situation shows no signs of abating,
it believes it may not be able to meet its
interest payments of US$12.86m, US$8.3m
and US$11.42m for its 7.35% 2025, 8.3%
2023 and 7.875% 2024 bonds, respectively,
which are currently in their grace periods.
But Zhenro says it plans to make interest
payments for its notes by May 31.
CSFG joined the syndicate group during
bookbuilding.
The borrower will use the proceeds from
the Hong Kong-listed trade for general
corporate purposes.
›FOSHAN LGFV PRICES SUSTAINABLE BOND
FOSHAN GAOMING CONSTRUCTION INVESTMENT GROUP
has raised US$200m from the sale of a
three-year bond at 3.5%.
The sustainability bond was sold at par
after being opened directly at final price
guidance of 3.5%.
The unrated notes are backed by a letter of
credit from CHINA ZHESHANG BANK FOSHAN BRANCH.
The proceeds from the Hong Kong-listed
trade will be used to finance or refinance
the group’s projects that fall under its
sustainable finance framework.
Guotai Junan International, Goldbridge
Securities and China Zheshang Bank Hong Kong
branch were the global coordinators for the
Reg S transaction. They were also the lead
managers and bookrunners with Carlyon
Securities, China International Capital Corp,
Founder Securities Hong Kong and Sunfund
Securities.
›GANZHOU LGFV PRICES BOND
GANZHOU DEVELOPMENT INVESTMENT HOLDING GROUP
has priced a US$300m 4.5% three-year bond.
The notes were sold at par, according to a
stock exchange filing.
Under the terms of default, investors
may request an acceleration of payment for
the bonds, but no such notice has yet been
received by the company.
Zhenro’s bonds have been trading at
distressed levels, with cash prices below 20.
SUNAC MISSES PAYMENT
Meanwhile Reuters reported that SUNAC
CHINA has not paid a US$29.5m coupon due
on April 11 on a dollar bond. The missed
payment, a person with knowledge of the
matter confirmed on Tuesday, marks the first
missed offshore payment for the country’s
third largest property developer by sales.
The payment for the 7.96% bond maturing
in October 2023 has a 30-day grace period
before triggering a default. Another source
close to the company said Sunac is trying to
find a funding solution to meet the payment
deadline.
International Financing Review Asia April 16 2022 21
COUNTRY REPORT CHINA
China International Capital Corp and
China Securities International were the
global coordinators. They were also the
bookrunners and lead managers with
Hua Xia Bank Hong Kong branch, Shenwan
Hongyuan, China Everbright International,
Bank of China, CMBC Capital, Industrial Bank
Hong Kong branch, CCB International, Huatai
International, CNCB Capital and CLSA.
The Singapore-listed bonds will be rated
Baa3/BBB– (Moody’s/Fitch).
›YIWU LGFV SELLS SENIOR BONDS
YIWU STATE-OWNED CAPITAL OPERATION printed a
US$500m 3.5-year senior note on Tuesday.
It priced the bond at par to yield 4.1% after
initially marketing at the 4.5% area.
Yiwu will use the Reg S notes to
refinance its offshore debt.
Offshore special purpose vehicle
Chouzhou International Investment issued
the bonds, while the LGFV provided a
guarantee.
The notes will be rated Baa3/BBB
(Moody’s/Fitch), in line with the guarantor.
Standard Chartered, Bank of China and
Guotai Junan International were joint global
coordinators. They were also the lead
managers and bookrunners with Bank of
Communications, China Citic Bank International,
China Securities International, Hua Xia Bank HK,
Industrial Bank HK, OCBC Bank and Shanghai
Pudong Development Bank HK.
Joint manager and bookrunner CICC was
Sunac declined to comment.
China’s property sector has been hit
by a series of defaults on offshore debt
obligations, highlighted by China Evergrande
Group, once the country’s top-selling
developer but now the world’s most indebted
property company.
Sunac’s bond in question traded at 27.55
cents on the dollar as of 10:40am GMT
Tuesday, compared to 34.269 cents on
Monday morning.
The company said last month it was
holding communications with offshore
creditors on debt solutions after downgrades
by global rating firms, as well as seeking
payment extensions with onshore
bondholders.
It extended the principal payment of a
Rmb4bn (US$627.91m) puttable bond due
on April 1 by 18 months.
MORGAN DAVIS
dropped from the syndicate list during the
bookbuild.
Yiwu is a city in Zhejiang province. The
LGFV last tapped the US dollar bond market
in August 2020, when it raised a US$500m
three-year senior bond at 3.15%.
SYNDICATED LOANS
›ZHENGZHOU COAL PRICES TIGHTER
SEG AUTOMOTIVE GERMANY, a subsidiary of
Shanghai and Hong Kong-listed Zhengzhou
Coal Mining Machinery Group, has returned
to the market with a €400m (US$435m)
three-year loan, offering tighter pricing than
the borrowing it is refinancing.
Deutsche Bank and Standard Chartered
are the mandated lead arrangers and
bookrunners of the latest transaction,
which comprises a term loan and a
revolving credit facility.
The interest margins are 140bp and
180bp over Euribor respectively for the
term loan and the revolver.
MLAs taking US$50m or above will
receive a 90bp fee for top-level all-in pricing
of 170bp and 210bp for the term loan
and revolver respectively. Lead arrangers
committing US$35m–$49m will earn 75bp
in fees for all-ins of 165bp and 205bp, while
arrangers coming in for US$25m–$34m are
offered 60bp for all-ins of 160bp and 200bp.
Commitments are due by May 6.
The borrower’s parent is providing a
guarantee for the term loan portion, while
the revolver is secured over a first charge
mortgage of all material assets of SEG
Automotive Germany.
Proceeds will refinance a €300m three-
year loan the borrower obtained in 2019
and fund general corporate purposes.
Deutsche was the sole MLAB of the 2019
borrowing, which offered a top-level all-in
of 255bp (for lenders not joining ancillary
facilities) and 271bp (for lenders providing
the ancillary facilities), based on a margin
of 240bp over Euribor.
Founded in 1958, Zhengzhou Coal
Mining Machinery is the largest coal
mining equipment supplier in China with a
domestic market share of over 30%.
›SHIMAO EXPECTED TO SEEK WAIVER
Cash-strapped Chinese developer SHIMAO
GROUP HOLDINGS is expected to send waiver
requests relating to a potential breach of a
listing covenant on several of its existing
offshore syndicated loans following a
trading halt to its shares this month.
The listing covenant on Shimao’s
syndicated loans stipulates that the
company’s shares must not be suspended
22 International Financing Review Asia April 16 2022
for more than 10 consecutive trading days,
meaning a breach could occur if trading
does not resume on April 19.
Trading of Shimao’s Hong Kong-listed
shares has been suspended since April 1 as
the company has not been able to publish
its unaudited 2021 results in time.
The developer has yet to send a formal
request for the waiver, but has indicated its
intention to do so.
Meanwhile lenders are processing approvals
to amend the repayment schedule of Shimao’s
existing US$1.35bn syndicated loan.
The company sought to amend and
extend the loan barely a month after
winning unanimous consent from lenders
to defer an instalment repayment.
Consent from all lenders to the
borrowing is required for the latest
proposed changes.
Shimao is looking to extend the maturity
of the loan to 2025 from 2023.
According to the proposed repayment
schedule, the company will make a 10%
instalment repayment upon signing of the
supplemental agreement.
Subsequent repayments will take place
via three unequal annual instalments: 20%
(2023), 30% (2024), 40% (2025).
On March 3, Fitch downgraded Shimao
Group to CCC on rising refinancing risk.
›BEIJING ENTERPRISES RAISES LOAN
State-owned BEIJING ENTERPRISES HOLDINGS has
raised a €534m one-year loan, according to
a filing to the Hong Kong stock exchange
on April 12.
The transaction comprises portions of
€500m and US$37m.
Funds are for refinancing purposes.
Throughout the life of the loan, Beijing
Enterprises Group shall own, directly
or indirectly, at least 40% of Beijing
Enterprises Holdings, and remain the single
largest shareholder of the company.
Beijing Enterprises Group shall also
remain wholly owned, supervised and
controlled by the People’s Government of
Beijing Municipality.
Hong Kong-listed Beijing Enterprises
Holdings distributes natural gas, supplies
water, provides wastewater treatment
services and brews beer in China.
›PING AN REAL ESTATE INCREASES LOAN
A unit of Ping An Real Estate has further
increased its three-year green loan to
US$400m after attracting one more bank.
China Minsheng Banking Corp is the latest
lender to join with US$40m, a couple of
weeks after the loan was increased to
US$360m from an original US$300m target.
More banks may join later.
Bank of China, China Citic Bank International,
Mizuho Bank and Shanghai Pudong Development
Bank were the mandated lead arrangers and
bookrunners of the bullet financing, which
offered a top-level all-in pricing of 180bp
via an interest margin of 150bp over Libor.
PING AN REAL ESTATE CAPITAL is the borrower,
while parent Ping An Real Estate is
providing a keepwell deed.
Proceeds will be used for refinancing and
general corporate purposes.
In April 2019, Ping An Real Estate Capital
obtained a US$300m three-year loan from
14 lenders, including Deutsche Bank
Singapore branch as the sole MLAB.
That facility offered a top-level all-in of
245bp over Libor based on a margin of 200bp.
In January this year, Fupeng Investment
Management, a Hong Kong-incorporated
investment vehicle of Ping An Real Estate,
obtained a US$155m three-year loan
from five banks, including Deutsche and
Standard Chartered as the MLABs.
That deal pays a margin of 250bp over
Libor.
Ping An Insurance is the ultimate parent
of Ping An Real Estate Capital and Fupeng
Investment Management.
RESTRUCTURING
›DR PENG GETS BONDHOLDER CONSENT
DR PENG HOLDING HONG KONGhas obtained
majority consent from investors holding its
US$244.75m 7.55% 2022s for the sale of its
interest in undersea cable project Pacific
Light Cable Network.
The telecoms group launched the
consent solicitation on March 21 in relation
to the sale of its US-Hong Kong cable
network to British Virgin Islands-registered
Meister United for US$160m.
Investors holding a combined 86.88% of
the outstanding amount were present at
the bondholder meeting on April 12 with
93.17% of those present voting for the sale.
Bondholders who submitted in favour
before the early deadline of April 7 stand to
collect US$42.50 per US$1,000 of principal.
The 2022s are guaranteed by Dr Peng
Telecom & Media Group.
Morrow Sodali was the information and
tabulation agent.
EQUITY CAPITAL MARKETS
›LONGFOR INTELLIGENT LIVING GETS NOD
LONGFOR INTELLIGENT LIVING,
the property
management unit of Longfor Group,
secured listing approval on Wednesday
for a US$1bn–$1.5bn Hong Kong IPO, said

people with knowledge of the matter.
Even at US$1bn, the deal will be the
biggest Hong Kong IPO so far this year,
dwarfing the HK$4.24bn (US$544m) listing
of JL Mag Rare-Earth in January.
Hong Kong’s IPO market has been extremely
quiet this year with only 15 IPOs so far.
CCB International, CICC, HSBC and JP
Morgan are the sponsors of the Longfor
Intelligent deal.
The company may not start pre-
marketing immediately, as investor
sentiment towards the property sector is
still weak, said the people.
As of September 30, Longfor Intelligent
managed 835 residential projects across
80 cities in China, with gross floor area
under management of 174.5 million square
metres.
For the first nine months of 2021, it
posted a net profit of Rmb1.1bn (US$177m),
up 68.4% from a year earlier.
Longfor Group said it will have an
interest of at least 50% of Longfor
Intelligent after the spin-off.
Longfor’s shares rose 1.1% to HK$42.20
on Wednesday and are up 15% this year.
›BENEUNDER EYES HONG KONG OUTING
Sequoia-backed BENEUNDER is planning to
raise about US$300m–$500m from a Hong
Kong IPO this year.
The outdoor wear brand has filed a
listing application with CICC and Morgan
Stanley as the sponsor. China Renaissance is
the financial adviser.
The company makes apparel, umbrellas,
hats, footwear and other accessories. It
posted an adjusted net profit of Rmb136m
(US$21m) in 2021, up 244% from 2020.
Sequoia owns 19.4% of the company.
›DESTONE JOINS HK SPAC QUEUE
DESTONE ACQUISITION,a blank-cheque company
backed by China Vanke founder Wang Shi,
has filed for a Hong Kong IPO which could
raise about US$150m.
The special purpose acquisition company
plans to invest in the green technology and
eco-friendly consumer product and service
sectors in Asia-Pacific.
Wang Shi and Asia Investment Fund
Management are the promoters for the
SPAC. Asia Investment Fund Management is
owned by Liu Erh Fei, who was the head of
investment banking for China at Goldman
Sachs.
Morgan Stanley is the sponsor.
›DOWELL SERVICE PRE-MARKETS IPO
Property management company DOWELL
SERVICE GROUP has started pre-marketing a
Hong Kong IPO expected to launch this
week, according to people familiar with the
situation.
It could raise about US$50m, one of the
people said.
The company posted a net profit of
Rmb130.4m in 2021, up 54.4% from 2020.
The company managed 325 property
projects with a gross floor area of 28.2
million square metres as of December 31,
covering 51 cities in China.
Guotai Junan is the sole sponsor.
›FEUTUNE LIGHT FILES FOR NASDAQ IPO
FEUTUNE LIGHT ACQUISITION,a new SPAC linked
to China’s Tiger Brokers, has filed for a
US$85m Nasdaq IPO.
Tiger and EF Hutton are joint books on the
offering of 8.5m units at US$10. Each unit
comprises one share and one full warrant
exercisable at US$11.50. Craig Hallum
Capital is acting as qualified independent
underwriter.
Feutune Light would be the third Tiger-
affiliated SPAC after the earlier US listings
of TradeUp and Fortune Rise Acquisition,
plus TradeUp 88 currently on file with a
US$88m IPO. TradeUp is in the process
of closing its merger with Chinese eco-
friendly bitcoin miner Saitech agreed to in
September last year, while Fortune Rise is
still looking for a merger.
Feutune Light has ruled out China,
Macau and Hong Kong to source a potential
target and has a nondescript broad remit.
It is structured with a 12-month tenor,
US$10.15 of proceeds in trust and two
three-month extensions each for an extra
10 cents of trust funding.
The new SPAC is headed by Xuedong
“Tony” Tian, the head of US capital markets
at Tiger, and chaired by Ka Wai Cheung,
one of the two principal SPAC sponsors. Of
the 2.4m Class B founder shares (the 20%
promote), 440,000 are being distributed to
executives, including 120,000 to Tian. Tiger
will receive 60,000 Class A “representative
shares” upon closing of the IPO.
›LX TECH TO LIST IN HONG KONG
JD.com-backed LX TECHNOLOGY is planning to
raise about US$200m–$300m from a Hong
Kong IPO this year.
The device as a service (DaaS) provider
has filed a listing application with Haitong
International as the sponsor.
The company provides computer rental,
IT technical services and device recycling
services to enterprises.
JD.com owns 13.2% of LX Technology,
Tencent Holdings owns 1.88% and Lenovo 0.9%.
It posted a loss of Rmb449m in 2021,
compared with a loss of Rmb177m in 2020.
International Financing Review Asia April 16 2022 23
COUNTRY REPORT HONG KONG
›CIFI TAPS CB
Property developer CIFI HOLDINGS (GROUP)
has raised HK$588m from a tap of a 2025
convertible bond.
The issue price was marketed at 100.50–
101 of the principal amount and fixed at
100.75. The coupon is at 6.95%.
CIFI on March 31 sold the original
HK$1.957bn CB due 2025. There was a
same-day upsize option of HK$391m that
was not exercised.
The CB was traded at around 107 on
Monday when the deal launched, while
CIFI shares fell 4.7% to HK$4.64. The CB’s
conversion price is HK$5.53.
Some investors had asked CIFI to sell
more bonds in light of the performance of
the original CB, hence the tap. More than
20 investors applied but more than half
of them received nothing as allocations
were skewed towards those who had raised
reverse enquiries. The top five investors
took about 80% of the deal.
The company plans to use the funds
for refinancing, including upcoming
redemption of a 6.7% senior note due 2022
with about Rmb1.5bn outstanding.
Credit Suisse and HSBC were bookrunners.
HONG KONG
DEBT CAPITAL MARKETS
›BEA SELLS T2
BANK OF EAST ASIA raisedUS$500m when it
sold a 10-year non-call five Tier 2 bond on
Wednesday.
The Reg S trade was closed with a 4.875%
coupon. The notes were sold at 99.846
to yield 4.91% at a spread of 230bp over
Treasuries. Initial price guidance had been
set at the 260bp over area.
The final price had some premium
over where CreditSights estimated fair
value around 218bp over. The analysts
at CreditSights noted that BEA’s capital
standing is strong compared to its peers, as
it has a Tier 1 ratio of 19.8%. Its total capital
adequacy ratio is 21.6%.
The order book was closed with
US$2bn from 125 accounts, after reaching
US$2.5bn, with US$560m from the leads,
during the day. About 94% of the bonds
were allocated to Asian investors, 4% to
Europe, the Middle East and Africa and 2%
to offshore US accounts. Asset and fund
managers took 59%, banks 15%, private
banks 14%, and central banks, insurers and
pension funds 12%.
 The subordinated bonds will be rated
Baa2/BBB– (Moody’s/S&P), below the issuer’s
A3/A– ratings.
The proceeds from the Hong Kong-listed
trade are for general corporate purposes.
Bank of East Asia, Citigroup, Goldman Sachs
(Asia), HSBC and Standard Chartered were
the global coordinators. They were also
the bookrunners and lead managers with
ABC International, Bank of China, BOCOM
International, Bank of America, CCB International,
China Citic Bank International, China Everbright
Bank, China Minsheng Bank Hong Kong branch,
Credit Agricole CIB, Deutsche Bank, Guotai
Junan International, Haitong International, ICBC
International, Industrial Bank Hong Kong branch,
Morgan Stanley and SMBC Nikko.
›TOWNGAS SLB BASKS IN THE SUN
TOWNGAS SMART ENERGY, rated Baa1/BBB+
(Moody’s/S&P), on Wednesday priced
US$200m five-year sustainability-linked
bonds at Treasuries plus 140bp.
The Hong Kong-listed gas and water
supplier pulled in a strong book of over
US$1.1bn before final guidance at 140bp
was announced, but stayed firm on
sticking to its final issue size, enabling it to
compress pricing by 30bp from the initial
guidance of 170bp area.
Towngas has pledged to reach 8GW of
total photovoltaic installed capacity by 2025
under sustainability performance target
1, and increase solar energy sales to 7% of
total energy sales by 2025 under SPT 2.
A 25bp step-up in the coupon will apply
if Towngas does not achieve either of the
sustainability performance targets.
The 4% notes priced at 99.57 for a yield
of 4.096%.
TCCL Finance will be the issuer and
Towngas the guarantor of the notes that
will be drawn from a US$2bn guaranteed
MTN programme. Proceeds will be used to
refinance debt, fund capital expenditure
and meet general corporate needs.
Credit Agricole CIB, HSBC, Mizuho Securities
and UBS were joint global coordinators and
bookrunners, as well as joint lead managers
with Bank of America, DBS Bank and Morgan
Stanley.
Settlement is on April 26. The notes,
to be rated Baa1/BBB+ (Moody’s/S&P), will
be issued under Towngas’s sustainability-
linked financing framework. Credit
Agricole CIB is the SLB structuring adviser.
SYNDICATED LOANS
›VXI SEEKS LOAN FOR BAIN CAPITAL LBO
Outsourcing firm VXI GLOBAL SOLUTIONS is
seeking a US$615m term loan B to fund its
24 International Financing Review Asia April 16 2022
acquisition by Bain Capital Private Equity
Asia and repay existing debt.
The seven-year loan comes with 101 soft
call protection for six months. Other terms
are forthcoming.
Bank of America is the lead-left arranger.
Citigroup and HSBC are also arrangers.
VXI provides business process
outsourcing services to an array of
companies globally. It operates through
three segments: BPO Americas, BPO China
and Symbio, which the company acquired
in 2014.
The co-borrowers are MARS INVESTMENT
HOLDINGS and MARS US HOLDCO.
Bain declined to comment.
›LEO PAPER LINKS TRADE CREDIT TO ESG
LEO PAPER GROUP has signed debut
sustainability-linked trade finance credit
and hedging transactions with Standard
Chartered, the bank said in a press release
on April 12.
Leo Paper will use the US dollar-
denominated credit facility in Hong Kong,
China and Vietnam, while the hedging
transaction will be for managing foreign
exchange risks.
Under its sustainability-linked
framework, Leo Paper has committed to
reduce its hazardous waste and total waste
intensity to pre-determined levels over a
designated period of time.
StanChart will provide financial
incentives if the targets are met, whereas
a penalty will be imposed on unfulfilled
commitments.
›WEST KOWLOON AUTHORITY LIFTS SLL
WEST KOWLOON CULTURAL DISTRICT AUTHORITY has
raised a debut HK$4bn (US$510m) three-
year sustainability-linked loan, the first of
its kind for an arts and cultural institution
in Hong Kong, according to a press release.
HSBC and Standard Chartered were
the global coordinators, sustainability
structuring banks, mandated lead arrangers
and bookrunners of the transaction, which
attracted seven other banks.
Bank of Communications (Hong Kong), Hang
Seng Bank, Industrial & Commercial Bank of
China (Asia), Mizuho Bank came in as MLABs,
while Sumitomo Mitsui Banking Corp, Bank of
China (Hong Kong) and China Construction Bank
(Asia) are MLAs.
Proceeds of the term loan and revolving
credit facility will be used to meet the
WKCDA’s general corporate funding
requirements and refinance existing
indebtedness to support the development
of the district.
According to the SLL arrangement, the
WKCDA will receive a tiered discount rate
on the interest margin throughout the
three-year tenor of the loan if it achieves
certain pre-agreed environmental, social
and governance targets. These include
achieving green building certification,
offering accessibility services to persons
with disabilities and underprivileged
groups, and providing arts and cultural
learning youth programmes.
“The SLL demonstrates WKCDA’s
commitment to achieving sustainability
goals and our staunch support for green
financing,” said Henry Tang, chairman
of the WKCDA’s board. “We are proud
of being able to collaborate with like-
minded partners to build a vibrant cultural
hub with environmental and social
sustainability for our future generations.”
WKCDA is a statutory body established
by the Hong Kong government in 2008
to develop the West Kowloon Cultural
District, which spans an area of 40 hectares
alongside Victoria Harbour.
M+, the city’s museum of contemporary
visual culture in the district, started
operations last November. The Hong Kong
Palace Museum and Lyric Theatre Complex
are scheduled to open in July 2022 and
2024, respectively.
›CR MICRO BAGS DEBUT ESG-LINKED LOAN
CHINA RESOURCES MICROELECTRONICS has
signed a HK$1bn debut loan linked to
environmental, social and governance
metrics.
DBS Bank Hong Kong branch is the sole
lender of the three-year borrowing,
according to a press release from the
Singaporean bank on April 11.
The ESG-linked loan’s sustainability-
related performance targets include a
reduction in energy consumption, volatile
organic compounds and carbon dioxide
emissions.
It will replace an existing HK$1.6bn term
loan CR Micro signed in 2019.
China Development Bank and DBS
were lenders to that three-year term loan,
which matured on March 28, according to
Refinitiv LPC data.
RESTRUCTURING
›E-HOUSE WARNS OF DEFAULT
E-HOUSE (CHINA) ENTERPRISE HOLDINGS has failed
to push through an exchange of its existing
2022s and 2023s into new 2025s and will
instead implement a restructuring exercise
under the Cayman scheme.
The issuer also warned that the risk of
an event of default is high as it is unlikely
to obtain sufficient funds to redeem a
 COUNTRY REPORT HONG KONG

7.625% bond with an outstanding balance
of US$298.2m on the maturity date of
April 18.
“If the 2022 notes are not repaid on the
maturity date, an event of default under the
indenture for the 2022 notes will occur,”
said E-House on Thursday.
The exchange offer, launched on March
31, to swap the 7.625% 2022s and 7.6%
2023s with an outstanding balance of
US$300m into proposed 8% notes due April
2025 expired on April 13. E-House also
sought consent from the investors to waive
certain events of default and covenants.
A minimum acceptance totalling 90% of
the outstanding amount of each bond was
set for the exchange offer and consent
solicitation to succeed.
It said that it did not obtain the
minimum acceptance amount and will
drop the exchange offer.
The exchange and consent exercise
ran in parallel with an invitation from
E-House to the investors of both bonds to
tender accession deeds that will support
its restructuring plans that will be
implemented under the Cayman scheme.
The company said it has so far received
tenders from investors holding over 75%
– the minimum acceptance level – of the
outstanding amounts of the bonds, which
will clear the way for it to apply to the
Cayman courts to sanction its restructuring
plan. The tender for the restructuring
scheme will expire on April 22.
Hong Kong-listed E-House provides
real estate agency, brokerage, data and
consultancy services to some of the biggest
property developers in China, including
China Evergrande Group, China Vanke and
Country Garden Holdings, which are also
shareholders.
EQUITY CAPITAL MARKETS
›PRENETICS TO LIST IN MID-MAY
Diagnostics company PRENETICS, a Hong
Kong unicorn, is expected to list on Nasdaq
in mid-May through a merger with a US-
listed special purpose acquisition company
backed by Hong Kong billionaire Adrian
Cheng.
The proposed business combination
with Nasdaq-listed ARTISAN ACQUISITION has
been declared effective by the US Securities
and Exchange Commission, according to a
statement from Prenetics.
The start-up, which provides Covid-19
tests and testing services for the Hong
Kong government and the English Premier
League, as well as DNA tests, announced
the merger in September at an enterprise
value of US$1.25bn with a combined equity
value of about US$1.7bn.
Prenetics will receive proceeds of up to
US$459m in cash, including up to US$339m
of cash currently held in Artisan’s trust
account, a US$60m fully committed private
investment in public equity and forward
purchase agreements of US$60m from
investors including Aspex, PAG, Lippo,
Dragonstone and Xen Capital.
Investors have been very supportive of
Prenetics’ equity raising as it is a Hong
Kong company serving mainly the Hong
Kong and European markets, leaving it
unexposed to near-term Chinese regulatory
risk, a person close to the deal told IFR
earlier.
Prenetics’ revenue is projected to grow
215% from US$65m in 2020 to US$205m
in 2021, and increase further to more than
US$600m in 2025.
UBS is acting as sole financial adviser and
exclusive capital markets adviser to Artisan.
Citigroup is acting as sole financial adviser
to Prenetics. UBS, Citigroup, Credit Suisse and
CICC are the placement agents on the PIPE.

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International Financing Review Asia April 16 2022 25


INDIA
DEBT CAPITAL MARKETS
›SHRIRAM TRANSPORT PLANS FRN
SHRIRAM TRANSPORT FINANCE is planning to raise
up to Rs7bn (US$92m) from two-year floating-
rate notes, according to market sources.
The commercial vehicle financier is
looking to sell the bonds at a spread of
205bp over the 12-month treasury bill,
which is hovering at 4.75%.
Standard Chartered is the arranger.
India Ratings has assigned a AA+ rating
to the bonds.
The issuer is yet to make an official
announcement on the planned bond sale.
SYNDICATED LOANS
›UPL WRAPS UP US$700M SLL
Agrochemicals company UPL has signed
a US$700m multi-tranche sustainability-
linked loan with 10 lenders joining in
general syndication.
HSBC, Intesa Sanpaolo, MUFG, Rabobank
and Societe Generale were the mandated
lead arrangers, bookrunners and equal
underwriters of the pre-funded deal.
MUFG and Rabobank were the lead
sustainability coordinators of the SLL.
MUFG is the facility agent.
The bullet loan is split into a US$500m
IRFC rolls forth with yen green loan
„ Loans Latest borrowing is significantly larger than company’s recent yen financings
State-owned INDIAN RAILWAY FINANCE CORP has
launched its US$1.1bn-equivalent yen green
loan into general syndication.
Mizuho Bank, MUFG and Sumitomo
Mitsui Banking Corp are the mandated lead
arrangers and bookrunners of the loan, which
is split into a US$400m-equivalent seven-
year tranche and a US$700m-equivalent
10-year portion paying interest margins of
81bp and 93bp over the Tokyo Overnight
Average Rate (Tonar) respectively.
The remaining lives are 6.75 and 9.75
years for the two tranches respectively.
Arrangers taking ¥2bn and above earn a
top-level all-in of 88bp and 100bp via fees
of 47.25bp and 68.25bp for the seven and
10-year tranches respectively, while lead
managers with tickets of ¥1bn–¥1.9bn will
26 International Financing Review Asia April 16 2022
five-year portion and another US$200m
2.1-year piece that will match the maturity
of a 2018 acquisition loan that is being
refinanced.
Banks were invited to join on a pro-rata
basis for a blended top-level all-in pricing
of 117.23bp based on a blended interest
margin of 109.32bp over Libor and a
remaining life of 3.92 years, with transfers
taking place at the end of March.
The borrower will earn a reduction
of up to 5bp in the margin if it meets
sustainability metrics targets relating to
water consumption, carbon emissions and
solid waste disposal.
The sustainability parameters are the
same as UPL’s debut US$750m five-year
SLL completed in April last year that paid a
top-level all-in of 150bp based on a margin
of 130bp over Libor and a remaining life of
4.92 years.
That borrowing attracted 14 banks other
than original MLABs and equal underwriters
MUFG and Rabobank Hong Kong branch.
The SLLs refinance part of a US$3bn
five-year borrowing closed in 2018 that
backed UPL’s purchase of US-based Arysta
LifeScience.
The 2018 loan paid a top-level all-in of
175bp via an initial margin of 160bp above
Libor based on UPL’s ratings of Baa3/BBB−/
BBB−.
The ratings remain unchanged.
For full allocations, see www.ifre.com.
›MANJUSHREE LBO DRAWS SEVEN
Private equity firm Advent International
Corp has closed syndication of a US$166m
receive all-ins of 86bp and 98bp via fees of
33.75bp and 48.75bp respectively.
Commitments are due by May 13.
The three Japanese mega-banks signed
the facility on March 11.
In January, IRFC raised US$500m from
a 10-year 144A/Reg S green bond priced at
Treasuries plus 185bp.
The latest loan is significantly larger than
IRFC’s recent yen loans.
Last year, the financing unit of India’s
Ministry of Railways mandated SMBC on
a US$325m-equivalent 10-year term loan,
which closed with German state-owned
development bank KfW joining.
It followed a US$300m-equivalent 10-year
yen borrowing in 2020 that also attracted
only KfW in senior syndication. Original
loan to refinance debt for portfolio
company Manjushree Technopack.
Standard Chartered was the sole mandated
lead arranger and bookrunner of the five-
year amortising loan for the Indian plastic
packaging company, which attracted seven
lenders.
The reference rate of the borrowing was
changed to term SOFR from Libor during
syndication, which was launched in mid-
November.
At the time, the facility offered a top-
level all-in pricing of 484bp based on an
opening interest margin of 450bp above
Libor with an average life of 4.75 years.
The all-in and opening margin remain
unchanged with only the reference rate
changed to SOFR.
AI LENARCO MIDCO is the borrower of the
facility, which will refinance existing debt
at the holding company, reduce debt at
the operating company and fund bolt-on
acquisitions.
In 2018, Advent raised a US$72m five-
year loan to fund its acquisition of a 77.24%
stake in the Bengaluru-based company.
BNP Paribas, Deutsche Bank and Nomura
were the MLABs of that facility, which
matures in September 2023, according to
Refinitiv LPC data.
For full allocations, see www.ifre.com.
›ESR INDIA IN TALKS FOR IFC LOAN
Logistics property investor ESR INDIA
INVESTMENT HOLDINGS is seeking a senior
secured loan of up to Rs7.5bn (US$98.7m)
from the International Finance Corp.
Select special purpose vehicles of ESR
MLABs State Bank of India and SMBC
had pre-funded the deal, committing the
equivalent of US$150m apiece.
The borrowing offered top-level all-in
pricing of 100.3bp in general syndication
based on a margin of 93.5bp over yen Libor
and a remaining life of 9.5 years.
The borrower also raised large US dollar-
denominated loans last year. In March, it
tapped SBI for two bilateral loans – a US$1bn
10-year facility and a US$2bn 7.5-year
borrowing – according to Refinitiv LPC data.
IRFC, rated Baa3/BBB−/BBB−, funds
the acquisition of rolling stock assets, the
leasing of railway infrastructure assets and
lending to other entities under the Ministry of
Railways.
EVELYNN LIN, MIRZAAN JAMWAL

– which will own, develop and operate
warehousing and industrial properties in
India – will act as borrowers of the financing.
The IFC’s longer-term financing will
provide greater financial flexibility to the
company during the long construction and
ramp up period, according to an investment
disclosure from the multilateral agency.
The loan facility will be committed in
tranches to select parks where land has
already been acquired.
The SPVs are indirectly owned by
ESR India Holdings, a Singapore limited
partnership which is managed by ESR India
and Reco Amaranthus, a Singapore limited
partnership managed by GIC.
ESR currently has a portfolio of 17 parks
under various stages of development or in
operation across nine cities in India via a
develop-to-hold strategy.
In December 2020, ESR obtained a
Rs1.8bn five-year term loan for a Pune
SPV from IndusInd Bank and Arka Fincap,
according to Refinitiv LPC data.
ESR is managed by ESR Cayman. It is part
of ESR Group, one of the largest logistics
and industrial warehousing developers in
the Asia Pacific region.
EQUITY CAPITAL MARKETS
›BIBA FASHION FILES FOR IPO
Traditional female clothing and accessories
maker BIBA FASHION has filed for a domestic
IPO of up to Rs15bn (US$197m).
Primary shares for Rs900m and 27.8m
secondary shares will be sold. Controlling
shareholder Meena Bindra and investors
Highdell Investment (a Warburg Pincus
affiliate) and Faering Capital are the vendors.
The company is planning a pre-IPO
placement of Rs180m and, if completed,
will reduce the primary portion
accordingly.
Revenue in the year to March 2021 was
Rs5.3bn, down 30% from Rs7.6bn in FY2020.
The net loss was Rs118.4m compared with
a net profit of Rs89m.
Ambit Capital, DAM Capital, Equirus, HSBC
and JM Financial are the banks on the
transaction.
›GOVERNMENT SETS EV TARGET FOR LIC
The government is aiming to sell the
LIFE INSURANCE CORPORATION OF INDIA IPO at a
valuation of 1.2 times embedded value in
a deal which could raise about Rs323bn–
Rs453bn, people with knowledge of the
transaction said.
LIC’s embedded value, or the present
value of future profits, was Rs5.39trn as of
September 30 2021.
Earlier expectations were for a price to
embedded value of slightly below two times
to around 2.3 times. However, the volatility
in global stock markets after the Russian
invasion of Ukraine has led to a correction.
Depending upon demand, the government
aims to sell a 5%–7% stake in the IPO.
The government will decide on the IPO
timing soon and it could be launched at end
April or early May. The issue was initially
planned for early April.
If the IPO is not launched by mid-May,
the financials included in the prospectus
will no longer be valid and will have to be
updated, further delaying the deal.
In the draft prospectus the company
said up to 316m secondary shares will be
offered. Around 10% of the offer will be
reserved for millions of LIC policyholders
subject to certain eligibility criteria and an
individual cap of Rs200,000.
The IPO will be the country’s largest,
overtaking Paytm’s Rs183bn IPO completed
in November. LIC is 100% state-owned at
present.
Kotak, Goldman Sachs, JP Morgan, ICICI
Securities, JM Financial, Citigroup, Nomura,
Axis Capital, Bank of America and SBI Capital
Markets are working on the IPO.
INDONESIA
DEBT CAPITAL MARKETS
›INALUM MANDATES FOR BOND, TENDER
INDONESIA ASAHAN ALUMINIUM has mandated
banks to lead a new US dollar 144A/Reg S
trade alongside a tender offer.
BNP Paribas, JP Morgan and Mandiri
Securities are the global coordinators.
They are also the bookrunners alongside
Citigroup, BNI, DBS, MUFG and Standard
Chartered.
The new trade will include two or three
tranches of notes with tenors of five, 10
and/or 30 years.
The Baa2/BBB– (Moody’s/Fitch) borrower
has also announced a tender offer for up
to US$1.1bn of its US$1.25bn 5.71% 2023
bonds, its US$1bn 6.53% 2028 notes and
its US$750m 6.757% 2048 bonds. The
early tender price is set at US$1,041.25,
US$1,107.5 and US$1,088.75 per US$1,000
of principal, respectively. After that,
the offer is US$1,000, US$1,057.5 and
US$1,038.75 per US$1,000.
The early expiration of the tender is set
for 5pm New York time on April 27. The
tender offer will expire at 11:59pm New
York time on May 11,.
International Financing Review Asia April 16 2022 27
COUNTRY REPORT INDONESIA
Investor calls begin on April 18.
›MERDEKA COPPER EYES TWO-PART BONDS
MERDEKA COPPER GOLD has announced the
yields for a two-tranche Rp2trn (US$139m)
bond offering.
The miner has fixed the yields at 7.8% for
a Rp310bn three-year tranche and 9.25% for
a Rp1.7trn five-year piece, according to the
offer document.
Indo Premier Sekuritas, Sucor Sekuritas, UOB
Kay Hian Sekuritas and Aldiracita Sekuritas are
the lead arrangers.
Around 75% of the funds will be used to
pay a US$100m revolver facility and the
rest to partly fund capital expenditure for
its Merdeka Tsingshan Indonesia unit.
The bonds, rated A by Pefindo, will be
allotted to investors from April 25–26.
›PEGADAIAN TO SELL BONDS, SUKUK
State-owned auction house PEGADAIAN has
set the terms for a Rp4trn two-tranche
conventional and sukuk offering.
It has fixed the yields at 3.6% for a one-
year Rs2.4trn conventional tranche and
Rp671bn sukuk piece, and 5.35% for a
three-year Rp598bn conventional portion
and Rp320bn sukuk.
The bonds will be allotted to investors on
May 4.
BCA Sekuritas, BNI Sekuritas, Danareksa
Sekuritas, Indo Premier Sekuritas and Mandiri
Sekuritas are the lead underwriters.
Pefindo has assigned a AAA rating to the
secured bonds.
›WASKITA KARYA FIXES YIELDS
WASKITA KARYA has fixed the yields on
Rp3.8trn of government-guaranteed
conventional bonds and sukuk, according
to a prospectus.
The state-owned construction company is
planning to sell a five-year tranche of bonds
and sukuk at 6.65% and a seven-year piece
at 7.55%.
It is targeting Rp2.68trn from the bonds
and Rp1.15trn from the sukuk.
The notes are rated AAA by Pefindo. The
books opened on April 11 and close on
April 19.
Bahana Sekuritas, BRI Danareksa Sekuritas,
DBS Vickers Sekurtias, Indo Premier Sekuritas
and Mandiri Sekuritas are the lead arrangers.
SYNDICATED LOANS
›MEDCO BAGS CONOCOPHILLIPS M&A LOAN
Oil and gas company MEDCO ENERGI
INTERNASIONAL has closed syndication of
its US$450m two-year loan backing its
acquisition of ConocoPhillips Indonesia
after attracting six lenders.
Bank Mandiri, Bank Negara Indonesia, BNP
Paribas, Credit Agricole CIB, Societe Generale
and Sumitomo Mitsui Banking Corp joined the
borrowing as mandated lead arrangers.
ANZ, DBS Bank, ING Bank, Morgan Stanley,
MUFG and Standard Chartered were the
mandated lead arrangers and bookrunners
of the amortising loan, which is said to pay
an interest margin in the high 300bp over
Libor, adjusted with Bloomberg’s credit
adjustment spread released in March 2021.
Subsidiary Medco Energi Global is the
borrower, while Medco is the guarantor of
the loan, which was signed with the lead
banks on December 11, according to a stock
exchange filing on December 13.
Medco Energi is buying the entire issued
share capital of ConocoPhillips Indonesia
from Phillips International Investment,
a subsidiary of ConocoPhillips, for a total
value of US$1.355bn.
ConocoPhillips Indonesia holds a 100%
stake in ConocoPhillips (Grissik) and a 35%
interest in Transasia Pipeline.
ConocoPhillips (Grissik) is the operator
of the Corridor PSC with a 54% working
interest. The Corridor PSC has two oil-
producing and seven gas-producing fields
located onshore in South Sumatra in
Indonesia.
Medco’s last visit to the loan market was
in 2019 for a US$550m one-year bridge
facility backing its takeover of upstream oil
KKR makes bigger yen bond return
„ Bonds US investment giant expands regional investor base, but lacks support for ultra long tranches
US investment company KKR returned to
the yen market for the first time since 2018
last week, raising ¥60.5bn (US$483m)
from a five-tranche yen bond offering that
drew more demand from Japanese regional
investors than its debut.
The 144A/Reg S senior unsecured deal
comprised five, seven, 10, 12 and 15-year
tranches. The ¥36.4bn five-year tranche priced
with a 1.054% coupon at 90bp over Tonar mid-
swaps, the ¥4.9bn 1.244% seven-year at 100bp
over, the ¥6.2bn 1.437% 10-year at 107bp over,
the ¥7.5bn 1.553% 12-year at 112bp over, and
the ¥5.5bn 1.795% 15-year at 127bp over. All
tranches will be issued at par.
The 1%-plus coupon on the shortest tranche
helped draw good demand from Japanese
regional investors. One banker on the deal said
more regional accounts participated in this
deal than in the previous one. The coupon is
28 International Financing Review Asia April 16 2022
and gas explorer and producer Ophir.
Standard Chartered was the sole MLAB
and facility agent of the financing, which
attracted four other lenders in syndication
and paid an initial margin of 650bp over
Libor.
Listed on the Jakarta Stock Exchange,
Medco Energi is involved in oil and gas
exploration and production, drilling and rig
services, electrical power generation and
coal mining.
Medco Energi is rated B+/B+ (Fitch/S&P).
JAPAN
DEBT CAPITAL MARKETS
›ORIX GOES GREEN FOR EURO DEBUT
Financial services firm ORIX made its debut
in the euro senior market with a €300m
(US$327m) four-year green bond on
Wednesday.
The inaugural deal followed two days of
investor calls, in which the issuer gathered
feedback for a €300m four-year green
senior unsecured and/or a €300m eight-year
conventional senior unsecured issue.
The issuer ultimately decided to go it
alone with the shorter green offering.
Leads Bank of America, BNP Paribas,
Citigroup, Credit Agricole and JP Morgan
definitely attractive given that five-year JGBs
traded at 0.025%–0.03%.
Offshore accounts bought the 12-year
tranche, while life insurers were key investors
in the other tranches.
KKR had marketed 20 and 30-year
tranches, but both were dropped. Investors
were happy with the coupons on the shorter
pieces and hence saw no big reason to buy
ultra long tranches.
Respective initial price guidance when
the books opened on Monday night was
85bp–90bp, 95bp–100bp, 105bp–107bp,
110bp–112bp, 125bp–127bp, 140bp area and
145bp area. The guidance was finalised at
90bp, 100bp, 107bp, 112bp, 127bp, 140bp and
145bp.
The issuer paid good extra premiums,
compared to its US dollar secondary curve, in
order to maximise demand. The seven-year
marketed the no-grow transaction with
initial price thoughts of mid-swaps plus
90bp area.
The deal, which is expected to be rated
A3/A–/A–, was ultimately launched at 75bp
with final demand coming in at around
€535m.
At that level, it offered a pick-up of some
20bp–30bp versus the secondary curves of
Japanese banks with a presence in euros,
said bankers.
While Orix has not issued in the euro
market it has an established presence in
the US dollar bond market. Its last such
deal came last Wednesday, when it priced a
US$500m 10-year at a spread of 145bp over
Treasuries, with a coupon of 4%.
As of the end of 2021, 7% of Orix’s
funding came from overseas bonds and 8%
from domestic bonds. The bulk comes from
borrowings from financial institutions (49%)
and deposits (31%).
Orix aims to reduce its carbon emissions
by 50% by March 31 2030 from the level at
March 31 2020, and to be carbon-neutral by
the end of March 2050.
›MUFG PRICES TLAC TRADE
has sold a
MITSUBISHI UFJ FINANCIAL GROUP
US$2bn three-tranche senior bond deal.
The SEC-registered transaction was split
between a US$500m 3.837% four-year non-
call three note, a US$800m 4.08% six-year
non-call five note and a US$700m 4.315%
11-year non-call 10 note. All tranches were
tranche, for example, priced about 40bp
above its existing US dollar bonds.
The issuer is KKR Group Finance Co XI
with a guarantee by KKR and KKR Group
Partnership.
This was KKR’s second yen trade, after its
debut in March 2018 when it raised ¥40.3bn
from a three-part deal across five to 20-year
maturities.
Mizuho, SMBC Nikko, Morgan Stanley,
and Nomura were joint bookrunners. The
bonds have ratings of A/A/AA–/AA– (S&P/
Fitch/R&I/JCR).
The proceeds of this offering will be used
for general corporate purposes, including
to fund the acquisition of Mitsubishi Corp-
UBS Realty from Mitsubishi and UBS
Asset Management, and potential future
acquisitions and investments in Japan.
TAKAHIRO OKAMOTO

priced at par, or spreads of 112.5bp, 130bp
and 155bp over US Treasuries, respectively.
The three tranches were initially
marketed at 125bp–130bp over, 145bp–
150bp and 170bp–175bp, respectively.
CreditSights said in a report fair value
for the four-year notes should be around a
G-spread of 105bp, and that for the six-year
and 11-year tranches at spreads of 120bp
and 143bp.
The proceeds will be used to support
MUFG Bank and Mitsubishi Trust and
Banking Corp’s total loss-absorbing
capacity. Fitch said in a press release that
MUFG met the 16% minimum total external
TLAC capital ratio requirement as of the
end of December 2021. The rating agency
estimated the capital buffers met the 18%
minimum requirement for March this year.
The bonds are rated A1/A–/A–, in line
with the issuer.
Morgan Stanley and MUFG were the
bookrunners.
The deal statistics were not disclosed.
›JERA SELLS FIVE-YEAR BOND
Power company JERA has priced a US$300m
five-year bond at 3.665%.
The Reg S trade was sold at par, or a
spread of 100bp over Treasuries.
Mizuho, Citigroup and JP Morgan were the
bookrunners.
The senior notes will be rated A– by S&P.
The proceeds from the Singapore-listed
trade will be used for general corporate
purposes.
SYNDICATED LOANS
›JOGMEC PRICES ¥449BN LOAN
has priced
JAPAN OIL GAS & METALS NATIONAL CORP
a ¥449.20bn (US$3.632bn) one-year bullet
loan at a zero interest rate, the state-backed
company said in a statement on April 13.
The interest rate on the government-
guaranteed loan was determined through a
conventional auction that met with heavy
oversubscription.
Mizuho Bank is the agent.
The drawdown is slated for April 28.
Proceeds will be used for operating funds.
JOGMEC priced a ¥318.70bn one-year
bullet loan at a zero interest rate in April
last year.
The company’s most recent borrowing
was a ¥36.38bn one-year zero-interest rate
loan in February.
›SUMITOMO CHEM BAGS TRANSITION LOAN
SUMITOMO JOINT ELECTRIC POWER,
a unit of
Sumitomo Chemical, has signed a ¥8bn
nine-year transition loan to build a liquefied
natural gas facility in Ehime prefecture.
Sumitomo Mitsui Banking Corp was the
arranger and structuring agent of the loan,
the bank said in a statement.
Chugoku Bank, Development Bank of Japan,
Ehime Bank, Hiroshima Bank, Hyakujushi Bank,
Iyo Bank, Meiji Yasuda Life Insurance, Norinchukin
Bank, Sumitomo Life Insurance and Sumitomo
Mitsui Trust Bank are among the lenders.
Signing took place on March 31.
Separately, Sumitomo Chemical is raising
a ¥10bn 10-year loan for a facility in Chiba
prefecture, which is scheduled to be signed
in the coming months.
The borrower has obtained certification
for the loans from Japan Credit Rating
Agency and DNV Business Assurance Japan.
Japan’s Ministry of Economy Trade and
Industry has selected the loans as models
for climate transition finance.
EQUITY CAPITAL MARKETS
›LAWSON WEIGHS IPO OF UNIT
Convenience store operator Lawson
is considering listing wholly owned
supermarket chain SEIJO ISHII.
Lawson’s shares surged as much as
11.6% on April 13, the day after the
announcement of the potential IPO.
The retailer said it is considering various
options to improve corporate value,
including the IPO, but it has not made a
final decision yet.
Local media reported on Tuesday that
Seijo Ishii could be listed in the 2023
financial year ending February 28 at a
valuation of more than ¥200bn (US$1.59bn).
Seijo Ishii, which operates more than 169
stores in Japan, posted operating income
of ¥11.2bn for the year ended February 28
2022, up 8.8% from a year earlier.
›PARK24 COMPLETES PLACEMENT
Car rental company PARK24 has raised ¥26.3bn
from a primary follow-on at ¥1,644 per share.
The books were multiple times covered,
with close to 60 investors participating
including existing shareholders and long-
only fund investors.
The top 10 investors took more than 60%
of the book and top 20 more than 85%.
It sold 16m primary shares, or 10.3% of
outstanding, at a fixed 9.9% discount to the
close of ¥1,825 on April 12.
There is a 180-day lock-up for the issuer.
Proceeds will be used for digital
investments and the expansion of its
mobility fleet, including purchases of
electric vehicles.
JP Morgan was the sole bookrunner.
International Financing Review Asia April 16 2022 29
COUNTRY REPORT MALAYSIA
MALAYSIA
DEBT CAPITAL MARKETS
›TNB POWERS UP SUSTAINABILITY SUKUK
TNB POWER GENERATION plans to sell inaugural
sustainability sukuk in tenors of 10, 15
and/or 20 years as early as the last week of
April.
The sukuk will be the first deal off a
newly established M$10bn (US$2.36bn)
Islamic MTN programme, rated AAA by
Marc.
CIMB Investment Bank and Maybank
Investment Bank are joint lead managers
for the deal, as well as principal advisers,
joint lead arrangers and joint sustainability
framework advisers for the programme.
Under the scheme, TNB Power can sell
sukuk in any structure, including green
or sustainable bonds that are aligned
with the SC’s sustainable and responsible
investment sukuk provisions, ASEAN
Capital Markets Forum’s green, social and
sustainability bond standards, as well as
green, social and sustainability principles
issued by the ICMA.
Proceeds from sustainability sukuk issued
off the programme will be used for eligible
projects set out in the issuer’s sustainability
sukuk framework which support its goal of
achieving net-zero emissions by 2050.
TNB Power, which was set up in 2020 to
hold parent Tenaga Nasional’s generation
assets and liabilities, said the programme
will give it flexibility in timing its
fundraising exercises, and access diversified
pool of investors in the local capital
markets.
Marc said TNB Power Generation has
a 59.9% share of the power production
capacity in Peninsular Malaysia. It is
also undertaking a 300MW hydropower
project in Kelantan as part of the utility’s
expansion into renewable energy.
SYNDICATED LOANS
›BATTERSEA COMPLETES A&E OF FACILITY
The £1.58bn (US$2.1bn) three-year multi-
tranche financing backing the acquisition
of commercial assets in phase 2 of the
BATTERSEA POWER STATION development in
London has been extended by two more
years.
Maybank carried out the amendment and
extension exercise of the borrowing, which
had closed as a five-bank club in February
2019.
 CIMB Bank, DBS Bank, OCBC Bank and
Standard Chartered were the other lenders.
PNB-Kwasa International 2, a 65:35 joint
venture between Permodalan Nasional and
Employees Provident Fund of Malaysia,
closed a £1.1081bn three-year financing,
which carries guarantees from the two
shareholders.
Separately, special purpose company
Battersea Phase 2 Holding signed a £470m
three-year financing comprising a £320m
term loan and a £150m revolving credit
facility.
The acquisition of the assets, for a total
consideration of £1.58bn, was completed in
mid-March 2019.
The power station building, comprising
seven phases, accounts for about six acres
of the overall 42-acre regeneration site. The
Battersea Power Station development was
originally scheduled for opening by late-
2020, but is now opening later this year.
›EPF EYES £135M FIVE-YEAR REFI
State-owned EMPLOYEES PROVIDENT FUND OF
MALAYSIA is seeking a five-year loan of up
to £135m to refinance a loan backed by
logistics assets in the United Kingdom.
The borrower is in the process of
mandating banks.
Last July, EPF was sounding the market
for a £259m five-year loan to refinance a
borrowing signed in December 2016.
In December 2020, EPF completed a
£800m five-year club loan with six banks
to refinance a £540m five-year bullet loan
from February 2016.
Bank of China (Hong Kong), DBS, MUFG,
OCBC Bank, Standard Chartered and United
Overseas Bank were the lenders of that
borrowing. Links Bidco was the borrower.
NEW ZEALAND
DEBT CAPITAL MARKETS
›PRECINCT PLANS SECOND GREEN BOND
PRECINCT PROPERTIES NEW ZEALAND has mandated
ANZ as arranger and joint lead manager
with Craigs Investment Partners, Forsyth Barr
and Jarden Securities for an unrated New
Zealand dollar senior secured six-year green
retail bond offer expected to open in the
shortened week after the April 25 Anzac
Day public holiday.
The issuer, which owns and develops
inner-city business property in Auckland
and Wellington, previously issued a
NZ$150m (US$102m) 2.85% six-year senior
30 International Financing Review Asia April 16 2022
secured retail note last May which priced
145bp wide of mid-swaps.
EQUITY CAPITAL MARKETS
›KING SALMON MAKES RIGHTS OFFER
ASX and NZX-listed NEW ZEALAND KING SALMON
INVESTMENTS is planning to raise NZ$60.1m
(US$41.2m) from a rights offer to repay
debt and strengthen its balance sheet.
The fish farming company will sell
400.8m new shares in a 2.85-for-1 pro rata
renounceable rights offer at NZ$0.15 per
share, or a 82.6% discount to the April 12
close of NZ$0.86.
King Salmon Investments’ largest
shareholder Oregon Group and the
company’s directors have committed to
subscribe to the offer for up to NZ$26.3m
in aggregate.
The offer will run from April 27 to May 6
and there will be no shortfall bookbuild for
leftover shares.
After the equity raising, the company
will be in a net cash position and have
total liquidity of NZ$13.2m to fund its
farming model transition and navigate the
pandemic.
Jarden is the underwriter.
PHILIPPINES
DEBT CAPITAL MARKETS
›AYALA FILES WITH SEC
AYALA plans to raise up to Ps15bn (US$288m)
from fixed-rate peso bonds, according to a
filing on the Philippine Stock Exchange.
The conglomerate has filed a registration
statement with the Securities and Exchange
Commission to sell Ps10bn of bonds with
an oversubscription option of Ps5bn.
It plans to sell series C bonds due in 2025
and series E notes due in 2029.
The issuance will be the second tranche
of a Ps30bn bond programme registered
with the SEC on May 12 2021.
PhilRatings has assigned a Aaa rating to
the notes.
›FILINVEST LAND GETS BOARD NOD
FILINVEST LANDplans to raise up to Ps11.9bn
from fixed-rate retail bonds with tenors of
three to five years, according to a filing on
the Philippine Stock Exchange.
The subsidiary of the Gotianun family’s
Filinvest Development conglomerate
received board approval on April 11 to sell
Ps8bn of bonds with an oversubscription
option of up to Ps3.9bn.
The issuance will be the third tranche
of a Ps30bn bond programme registered
in 2020 with the Securities and Exchange
Commission, after the company raised
Ps8.1bn on November 18 2020 and Ps10bn
on December 21 last year.
BDO Capital & Investment, BPI Capital,
China Bank Capital, East West Banking, First
Metro Investment, RCBC Capital and SB Capital
Investment are the joint lead underwriters
and bookrunners of the public offering.
Chinabank - Trust and Asset Management Group
is the trustee.
SYNDICATED LOANS
›AYALA UNIT AGREES TRANSITION LOAN
A unit of AYALA has signed an amended and
restated loan of up to Ps13.7bn (US$262m),
representing the first energy transition
financing from the Philippines.
Bank of the Philippine Islands is the
mandated lead arranger and bookrunner
of the borrowing, while Rizal Commercial
Banking Corp is a lead arranger, according to
a stock exchange filing on April 11.
South Luzon Thermal Energy Corp, a
wholly owned unit of AC Energy Corp, is
the borrower of the facility.
Proceeds raised will be used to refinance
an outstanding Ps9.8bn loan and fund the
partial redemption of AC Energy’s capital
held in SLTEC.
Last November, AC Energy, along
with the Ayala group, announced its
commitment to net-zero greenhouse
gas emissions by 2050, which will bring
its power generation output to 100%
renewable energy by 2025.
Through this mechanism, AC Energy’s
coal-fired power plant in Calaca, Batangas
province with a capacity of 244MW will be
decommissioned by 2040, 15 years ahead of
the end of its technical life.
The concept adopts the principles of
the Asian Development Bank’s Energy
Transition Mechanism in South and
South-East Asia. ADB announced an ETM
partnership involving the Philippines and
Indonesia at the United Nations Climate
Change Conference (COP26) in Glasgow last
year.
ETM aims to use public, private, and
philanthropic financing to provide low-
cost capital to coal-fired power plants to
accelerate their retirement and help jump-
start reliable and affordable clean energy.
“In leading the energy transition,
enabling mechanisms such as the ETM help
accelerate our shift to a low-carbon growth

path and unlock new renewable energy
investments,” said Eric Francia, AC Energy’s
president and CEO. “It is through this
shared commitment between the public
and private sectors towards achieving a
low-carbon economy, and our collective
action for a sustainable and inclusive future
that we can truly make an impact on our
climate goals.”
In March 2021, Ayala announced that
UPC-AC Energy Solar, a joint venture
between UPC Renewables and AC Energy
and Infrastructure Corp, borrowed a 20-
year loan of up to US$50m to fund a solar
power farm in western India.
The US International Development
Finance Corp provided the financing.
SINGAPORE
DEBT CAPITAL MARKETS
›CREDIT AGRICOLE RETURNS FOR TIER 2
CREDIT AGRICOLEon Wednesday priced a
S$250m (US$184.7m) 10.25 non-call 5.25
Tier 2 bond at 3.95%, inside initial guidance
of 4.2% area.
Orders crossed S$675m, including
S$220m of joint lead interest, before
guidance was tightened. Final orders were
over S$550m, including S$220m from
the joint leads, from 51 accounts. Banks
and financial institutions took 71%, fund
managers and insurers 19% and private
banks 10%. Asia accounted for 98% and the
European Union 2%.
The deal came after BNP Paribas re-
opened the Singapore dollar market to
foreign banks after an absence of two years
with a S$350m 10-year non-call five Tier
2 at 3.125% with a spread of 139.8bp over
SORA in February.
The French bank is thought to have paid
a small new issue concession based on the
references used. Its existing S$325m 3.8%
12-year non-call seven Tier 2 callable 2026
was seen at 3.74% on Wednesday, while the
BNPP 3.125% callable 2027s were quoted at
3.31%.
The Tier 2 deal was sold on the same
day that Credit Agricole raised €1.5bn
(US$1.6bn) of senior non-preferred debt via
a two-part five-year non-call four and 12-
year offering.
“Credit Agricole is taking in as much
funds as they can ahead of the French
presidential election,” said a syndicate
banker, adding that it also wants to lock
in current rates ahead of the US Federal
Reserve meeting in early May.
The subordinated benchmark deal is
rated Baa1/BBB+/A–, below the French
bank’s ratings of Aa3/A+/A+. There will be
a reset on July 22 2027 to the prevailing
SORA-OIS plus the initial credit margin of
160.9bp.
Settlement is on April 22 with the first
call date on July 22 2027. The coupon will
reset on the same date to the prevailing
SORA-OIS rate and the initial margin of
160.9bp.
Credit Agricole CIB, DBS Bank and OCBC Bank
were joint lead managers and bookrunners.
›ASCENDAS REIT SELLS GREEN BOND
ASCENDAS REIT on Monday priced S$208m of
seven-year senior unsecured green bonds at
3.468% with a spread of 102.4bp over SORA.
The notes, marketed at initial price
guidance of 3.75% area, pulled in final
orders of over S$450m from 45 accounts.
Fund managers and insurance companies
took 79%, banks and corporates 4% and
private banks 17%. Singapore made up 95%
and others 5%.
The Singapore-listed REIT will settle
the notes on April 19 off a S$7bn EMTN
programme.
Both the issuer, HSBC Institutional Trust
Services Singapore, and the notes are rated
A3 by Moody’s. Proceeds will be used to
fund or refinance eligible projects under
the issuer’s green finance framework.
OCBC was sole lead manager and
bookrunner as well as green finance
adviser.
Ascendas REIT sold a debut S$100m 10-
year senior green bond at 2.65% in August
2020 and a S$300m green perpetual non-
call five note at 3% in September 2020.
›ART JOINS SLB TREND
Hospitality assets owner and operator
ASCOTT RESIDENCE TRUST on Tuesday sold
S$200m of five-year sustainability-linked
bonds at 3.63%, becoming the fourth issuer
in Singapore to sell such a product.
Pricing tightened from the initial 3.85%
area and was a tad above the fair value of
3.6% estimated by OCBC’s credit analysts,
who referenced Frasers Property AHL’s
S$300m 3% 2028s, which were seen at 3.7%
on Tuesday with a spread of around 122bp.
The trust will pay an additional 25bp on
the principal at maturity if it does not meet
the core sustainability performance target,
which requires 50% of the company’s
total gross floor area to be awarded green
building standards or certifications by end-
December 2025. The trust had about 33% of
its properties green-certified as of end-2021
and aims to have 100% of its gross floor
area certified with green standards by 2030.
International Financing Review Asia April 16 2022 31
COUNTRY REPORT SINGAPORE
Final orders exceeded S$335m from 47
accounts. Fund managers and insurance
companies took 29%, banks, public sector
agencies and corporates 50% and private
banks 21%. Singapore accounted for all the
orders.
The notes, rated BBB– by Fitch, will settle
on April 20 via issuer Ascott REIT MTN and
guarantor DBS Trustee. The SLB will be
covered under ART’s sustainability-linked
financing framework on which Moody’s
ESG Solutions unit V.E has provided a
second-party opinion.
ART, which counts leading Singaporean
property owner CapitaLand Group as a
major shareholder, is the largest Singapore-
listed hospitality trust with a market
capitalisation of S$3.6bn.
DBS Bank was sole lead manager.
›SEMBCORP GOES LONG
SEMBCORP INDUSTRIES on Wednesday priced
S$300m seven-year sustainability-linked
bonds at 3.735%, inside initial guidance of
3.95% area.
The Singaporean conglomerate has
set a sustainability performance target
of achieving greenhouse gas emissions
intensity to 0.40 tCO2e/MWh or lower by
end-2025. If the goal is not achieved, there
will be a one-time 25bp increase in the
coupon on or after April 1 2026.
Bankers estimated that Sembcorp paid
minimal new issue concession of up to 5bp
for the deal and much of that included a
premium for duration risk. One banker said
investors were wary of tenors beyond five
years because of the rate hike environment.
Settlement is on April 20 with the notes
to be drawn from a S$3bn multi-currency
debt issuance programme. Proceeds will be
used for general corporate needs and debt
refinancing.
Sembcorp Financial Services will be the
issuer and the Temasek-owned parent the
guarantor.
DBS Bank, OCBC Bank and UOB are joint
lead managers. Proceeds will be for general
corporate needs and debt refinancing.
Sembcorp’s SLB is the fifth such
instrument to be sold in the local market
since Surbana Jurong priced Singapore’s
first SLB with a S$250m 10-year deal at
2.48% in February last year. Sembcorp
sold a S$675m 10.5-year SLB at 2.66% in
September last year.
SYNDICATED LOANS
›CHAILEASE SINGAPORE UNIT LIFTS LOAN
CHAILEASE INTERNATIONAL FINANCIAL SERVICES
(SINGAPORE) has increased its three-year loan
to US$180m from a US$100m target after
attracting six banks in general syndication.
Chang Hwa Commercial Bank was the
mandated lead arranger and bookrunner
of the transaction, which pays an interest
margin of 130bp over Taifx.
Lenders were offered a top-level upfront
fee of 35bp.
Signing took place on April 7.
The borrower’s Taiwan-based affiliate
Chailease Finance is the guarantor. Both
companies are units of Taiwanese leasing
giant Chailease Holding.
Funds are for working capital purposes.
For full allocations, see www.ifre.com.
›PAYA LEBAR LOAN COMPLETES A&E
Units of Australian property company
Lendlease Group have amended and
extended a S$2.005bn (US$1.47bn) multi-
tranche financing from June 2019 backing
a mixed-use property project in Paya Lebar
in Singapore.
The size of the borrowing is now reduced
to S$1.85bn as one of the tranches from the
original borrowing – a S$154m one-year
revolving credit facility – matured in 2020.
All other tranches of the borrowing will
now mature on June 18 2024.
DBS Bank, OCBC Bank, Sumitomo Mitsui
Banking Corp and United Overseas Bank
were the mandated lead arrangers and
bookrunners of the borrowing, which
Element Materials agrees buyout loan
„ Loans US dollar and euro tranches on TLB price at tighter OID levels
London-based testing services company
ELEMENT MATERIALS TECHNOLOGY has wrapped up
a US$1.825bn-equivalent term loan B to back
its acquisition by Singaporean state-owned
investor Temasek, following a positive market
response.
A US$1.425bn tranche finalised at 99.5
after being tightened to 98.5–99.0 from
97.5–98.0 at launch, while a US$400m-
equivalent euro-denominated tranche
finalised at 99.5 from previous guidance of
99.0–99.5, having already been tightened to
98.5–99.0 from 98 at launch.
Pricing on both tranches remains
unchanged at revised guidance of 425bp
over SOFR/Euribor, tightening from 450bp
at launch. The credit spread adjustment on
the dollar tranche remains unchanged at
10bp flat.
A 0.5% floor on the dollar tranche and
a 0% floor on the euro tranche remain the
same. The seven-year TLB has a 101 soft-call
32 International Financing Review Asia April 16 2022
originally comprised three and five-year
term loans of S$800m apiece, a S$154m
one-year revolving credit facility, a S$231m
five-year revolver and a S$20m five-year
bilateral piece from DBS.
The three-year tranche had attracted five
other lenders in syndication.
MILANO CENTRAL, ROMA CENTRAL and
VERONA CENTRAL, units of Lendlease, are
the borrowers of the financing, which
refinanced a S$2.12bn loan signed in
September 2015.
DBS, OCBC and SMBC were the MLABs of
the secured loan in 2015, which offered an
all-in pricing in the mid-100s and attracted
10 banks in limited syndication.
In 2015, a joint venture of Lendlease
and sovereign fund Abu Dhabi Investment
Authority won the tender with a bid
price of S$1.672bn for the large mixed-
use site offered for sale under Singapore
government’s land sales programme.
The site in Paya Lebar district has a
capacity for about 165,000 square metres
of real estate projects, including offices
as well as retail and residential/serviced
apartments.
›GP INDUSTRIES SEEKS S$70M LOAN
Singapore-listed electronics and batteries
maker GP INDUSTRIES has launched a S$70m
three-year amortising loan into limited
syndication.
protection for six months.
Ticking fees kick in on day 46 at 50% of the
applicable rate, rising to 100% on day 91.
“It’s a no-brainer deal with attractive
pricing,” said an investor.
Strong appetite for the deal is good news
for banks that have been sitting on around
€25bn (US$27.29bn) of underwrites across
loans and bonds after the leveraged finance
market closed in the wake of Russia’s
invasion of Ukraine.
Many of the larger deals in the pipeline are
expected to come to the market after Easter.
They include a €2.1bn-equivalent term loan
B backing Unilever’s sale of its tea business
to CVC and the much-delayed financing for
CD&R’s buyout of UK supermarket Morrisons,
on which lenders still have £4.4bn of paper
to syndicate.
Apart from the TLB, Temasek’s financing
package for Element also includes a
US$350m pre-placed second-lien, a
Maybank is the mandated lead arranger
and bookrunner of the facility, which pays
an interest margin of 290bp over SORA.
Last year GP Industries raised three-year
loans totalling S$105m in March to repay
borrowings maturing that May.
In July 2018, the borrower closed a
S$150m three-year bullet term loan that
pays a margin of 280bp over SOR.
OCBC and United Overseas Bank were
the MLABs of the financing, which attracted
five other lenders and was increased from a
S$120m target size.
GP Industries is the main industrial
investment vehicle of Hong Kong-listed
Gold Peak Industries (Holdings), which
owned approximately 86% of the company
as of November 2021.
›TOKYO CENTURY UNIT IN GREEN DEBUT
The Singapore subsidiary of Japan-
headquartered Tokyo Century has raised a
debut green loan of S$60m from MUFG.
Borrower TOKYO CENTURY LEASING (SINGAPORE)
will use the bilateral facility’s proceeds to
finance its auto loans business for electric
and hybrid vehicles, which is in line with
Singapore’s plan to phase out internal
combustion engine vehicles by 2040.
The loan is in compliance with the Loan
Market Association and the Asia Pacific Loan
Market Association’s Green Loan Principles,
according to a press release on April 12.
US$800m PIK loan at the holdco level, a
US$200m revolving credit facility, and a
US$200m acquisition capex facility.
The credit family rating is B2/B, and the
rating for the issue is B1/B.
The physical bookrunners included Bank of
America, which led the US dollar tranche; and
Goldman Sachs, which led the euro tranche.
ING was also a physical bookrunner for the
euro loan.
Credit Agricole and Lloyds Bank were
passive bookrunners, while Bank of Ireland,
HSBC, SMBC and Standard Chartered Bank
were mandated lead arrangers.
Temasek agreed in January to acquire a
controlling-stake of Element from private
equity firm Bridgepoint for an undisclosed
sum. Reuters cited sources as saying the
deal valued Element at about US$7bn. The
investor had been a minority shareholder in
Element since 2019.
PRUDENCE HO, CANDY CHAN

Deloitte & Touche provided an
independent assurance on the green loan’s
structure.
TCS provides loans for purchases of
vehicles and equipment as well as car
leasing.
Parent Tokyo Century closed two
sustainability-linked loans in March.
Sumitomo Mitsui Banking Corp was the
arranger of a ¥53bn (US$423m) 3.75-year
SLL that followed a ¥55.2bn 3.75-year SLL
arranged by Mizuho Bank earlier in the
month.
SOUTH KOREA
DEBT CAPITAL MARKETS
›MIRAE ASSET PREPS BOND SALE
MIRAE ASSET SECURITIES,rated Baa2/BBB
(Moody’s/S&P), is planning a sale of US
dollar three-year senior notes and/or a
senior sustainability-linked bond of five
years.
Citigroup, HSBC, Mirae Asset Securities
Singapore and Standard Chartered held
investor calls starting from last Tuesday,
ahead of the potential bond offering. HSBC
is also sustainability structuring bank.
Going green in the debt markets is not
new to the Korean securities firm, which
sold a US$300m three-year 1.375% Reg S
green note at Treasuries plus 95bp in June
2021.
›NEWLY FORMED KOMIR MAKES DEBUT
KOREA MINE REHABILITATION AND MINERAL RESOURCES
has sold its first US dollar bond, a US$425m
five-year transaction.
The 4.125% notes were priced at 99.933
to yield 4.14% at a spread of 135bp over
Treasuries. The initial price guidance was at
the 160bp over area.
The bonds were trading about 5bp wider
in the secondary market on Tuesday, in line
with the broader market.
The order book reached US$1.45bn
during the day. It landed at US$1.2bn from
86 accounts at reoffer.
The trade marked the first time that the
state-owned agency, also known as Komir,
had sold a dollar bond. The company was
only formed last year following a merger of
two agencies – Korea Resources Corporation
and Mine Reclamation Corporation – to
oversee the country’s metals, minerals and
mining sectors. Part of its responsibility is
to ensure the continued availability of raw
materials critical to key industries.
Korea Resources’ previous bonds are
now under the new name, but they do not
provide a direct comparable for Komir.
“It’s the first time really this newly
merged entity came to the market,” said a
syndicate banker on the deal. “The credit
profile is not exactly the same as the old
one.”
The syndicate banker said investors were
looking for about 5bp–10bp of new issue
premium for the deal. Another banker on
the trade estimated fair value would be
around 110bp–120bp over Treasuries.
About 82% of the notes were allocated
to Asian investors and 18% to Europe, the
Middle East and Africa. Asset and fund
managers took 50%, banks 34%, central
banks, sovereigns, supranationals and
agencies, and insurers 10% and private
banks and securities firms 6%.
The benchmark Reg S deal will be rated
Korea Midland Power pays up
„ Bonds New issue premium reflects market backdrop and coal links
KOREA MIDLAND POWER raised US$300m from
a five-year senior bond deal on Wednesday,
but it paid about 20bp of premium to close
the trade.
The state-owned utility company priced
the Reg S deal at 99.76 to yield 3.678%, or
100bp over Treasuries. The coupon was set at
3.625%.
The notes were trading 2bp to 3bp tighter
in the secondary market on Thursday.
The bonds were initially marketed at
130bp area and the final price guidance was
narrowed down to 100bp–105bp.
The final pricing included about 20bp of
new issue premium, by one banker’s estimate.
She put the fair value at 80bp referencing the
borrower’s 2026 bonds. Analysts at Nomura
saw fair value around 90bp.
In contrast, Korea Midland sold a
US$300m 1.25% five-year note in August
2021 at a yield of 1.306%, or 62.5bp over
Treasuries. That attracted a final order book
of US$2.7bn at the time.
The banker on the deal said the new
issue premium compensated investors for
the volatile market conditions, as well as
the fact that the borrower is a coal-related
company.
“Issuers usually pay 10 to 15bp premium
because of the interest rates, but Midland
has to pay slightly more for its coal-related
business,” said the banker. “They have a
smaller [investor] pool, so they need to offer
extra buffers to attract the fast money guys.”
She added that the demand for the notes
International Financing Review Asia April 16 2022 33
COUNTRY REPORT SOUTH KOREA
A1/A (Moody’s/S&P), in line with the issuer.
There is a change of control event at
100 if the Korean government ceases to
own and control at least 51% of the issuer.
Proceeds will be used for general corporate
needs, including the repayment of debt,
but will exclude any activities related to the
development of coal mines.
Bank of America, Citigroup, Credit Agricole
and HSBC were joint bookrunners.
›KOREA WATER RESOURCES GOES GREEN
KOREA WATER RESOURCES CORP, rated Aa2/AA
(Moody’s/S&P), is preparing a US dollar-
denominated green bond sale.
The Reg S trade will have a three-year or
five-year tenor.
BNP Paribas, Citigroup, Credit Agricole and
Societe Generale led investor calls that began
on April 13.
was smaller than other non-coal companies,
but the fact that the company specified that
the proceeds will not be used for new coal
construction helped a bit.
The orders peaked at US$1.2bn before price
guidance was revised. The trade was well
anchored by banks and pension funds, said
the banker.
The final order book stood at US$820m
from 56 accounts, including US$60m from
the bookrunners Citigroup and UBS. Asia
Pacific investors were allocated 90%, while
EMEA had 10%. Banks took 48%, asset
managers and fund managers 23%, agencies,
institutional investors and pension funds 19%,
and private banks, corporates and securities
houses 10%.
Korea Midland also benefited from the
slightly better market conditions compared
to the beginning of the week when mining
company KOREA MINE REHABILITATION AND MINERAL
RESOURCES priced its debut US$425m 4.125%
2027 bond.
The banker said investors were very
cautious earlier this week while waiting for
the US consumer price index data. “When
the number was out, it was in line with the
market’s expectation, and the core CPI was
not as high as expected, so that has helped
calm the market,” she said.
The Singapore-listed notes are expected to
be rated Aa2/AA (Moody’s/S&P).
The proceeds will be used for general
corporate purposes including refinancing.
PAN YUE
EQUITY CAPITAL MARKETS
›AVELLINO LAB PLANS IPO
AVELLINO LAB USA is planning to raise about
US$100m–$200m from a South Korea IPO,
according to a person familiar with the
matter.
The US-based biotech company filed a
listing application on March 30 with Mirae
Asset Securities as the underwriter.
Avellino chairman Gene Lee is its largest
shareholder with a 36% stake.
Founded in 2011, the company mainly
develops gene therapy and molecular
diagnostics for eye care. In 2020, it
expanded its business to develop diagnostic
tests for Covid-19.
TAIWAN
SYNDICATED LOANS
›CHAILEASE VIETNAM MAKES SOCIAL DEBUT
CHAILEASE INTERNATIONAL LEASING,
a Vietnam-
based unit of Taiwanese leasing giant
Chailease Holding, has launched a social
loan of up to US$100m, in the first such
financing in Taiwan’s syndicated loan
market.
Taipei Fubon Commercial Bank is the
mandated lead arranger and bookrunner
of the three-year transaction, which has
an initial size of US$90m and a US$10m
greenshoe.
The loan, which offers an interest margin
of 145bp over term SOFR, is split into a
US$72m tranche A and a US$18m tranche
B.
Proceeds raised from tranche A will
finance the funding needs of small-and-
medium and micro enterprises, while
tranche B is for general corporate purposes.
MLAs joining with US$20m or above
will receive an upfront fee of 25bp, while
participants taking US$10m–$19m are
offered 17bp.
Banks committing before May 13 will
earn an early-bird fee of 3bp. The final
deadline is May 20.
Chailease Finance, a subsidiary of
Taiwan-listed Chailease Holding, is the
guarantor on the loan.
The loan is structured in accordance with
the Social Loan Principles issued by the Asia
Pacific Loan Market Association
An independent third party will issue an
assurance report.
In June 2021, the borrower raised a
US$80m three-year loan from ten banks.
34 International Financing Review Asia April 16 2022
Taipei Fubon also led that deal, which
paid a top-level all-in pricing of 145bp
based on an interest margin of 135bp
over Libor.
›CHENG LOONG LAUNCHES LOAN
Taiwan-listed paper products maker CHENG
LOONG has launched a NT$8bn (US$281m)
five-year loan.
First Commercial Bank is the mandated
lead arranger and bookrunner of the
transaction, which comprises a NT$8bn
revolver tranche A, a NT$2.4bn term
loan tranche B and a NT$6.4bn guarantee
tranche C. The three tranches cannot
exceed NT$8bn combined.
Tranches A and B offer interest margins
of 48bp over Taibor, with a pre-tax interest
rate floor set at 1.7%, while tranche C pays
an annual guarantee fee of 48bp.
Banks are being invited to join as
MLAs with commitments of NT$2bn or
more for an upfront fee of 6bp, while co-
arrangers with NT$1bn–$1.9bn receive
5bp. Managers taking NT$500m–$999m
are offered 2.5bp.
Commitments are due by May 13.
Funds are to refinance a NT$7.2bn five-
year loan raised in April 2018, and for
working capital purposes.
FCB, Hua Nan Commercial Bank and
Taipei Fubon Commercial Bank were
the MLABs of the 2018 loan, which
comprises a NT$7.2bn term loan tranche
A, a NT$2.16bn term loan tranche B and
a NT$4.32bn guarantee tranche C. The
three tranches cannot exceed NT$7.2bn
combined.
Tranches A and B pay margins of 60bp
over Taibor, with pre-tax interest rate floors
of 1.7%, while tranche C pays an annual
guarantee fee of 55bp.
Cheng Loong last visited the loan market
in December 2020 for a NT$8bn five-year
facility, which pays a margin of 50bp over
Taibor and an annual guarantee fee of
50bp.
›ESLITE SPECTRUM DEBUT DRAWS NINE
ESLITE SPECTRUM,which runs the Eslite
bookstore chain and department stores
in Taiwan and overseas, has drawn nine
lenders to a NT$2.5bn debut loan.
Mega International Commercial Bank was
the sole mandated lead arranger and
bookrunner of the five-year transaction,
while Taiwan Business Bank joined as MLA.
Six other banks and two bills finance firms
participated.
The borrowing comprises a NT$500m
tranche A for refinancing purposes, a
NT$2bn tranche B for capital expenditure, a
NT$864m tranche C, a NT$300m short-term
bill tranche D and a NT$200m guarantee
tranche E.
All tranches cannot exceed NT$2.5bn
combined.
Tranche C is further split into a
NT$864m revolving credit tranche C1 and
a NT$864m commercial paper guarantee
tranche C2. Tranches C1 and C2 cannot
exceed NT$864m combined.
Tranches C and D are for working capital
purposes.
The interest margins for tranches A,
B and C1 are 70bp–80bp over the one-
year post office savings rate based on the
borrower’s pre-tax net profit margin, with
pre-tax interest rate floors of 1.7%.
Tranches C2 and E offer annual
guarantee fees of 65bp–75bp based on the
borrower’s pre-tax net profit margin, while
tranche D pays 62bp–72bp.
Eslite Spectrum chairperson Mercy Wu is
the guarantor of the unsecured loan.
Proceeds will mainly go towards
supporting the company’s store
expansion, including a mega outlet in a
shopping mall being developed by the
Yulon Group in New Taipei city’s Xindian
district. The outlet is expected to open in
2023.
For full allocations, see www.ifre.com.
›SHINSHIN CREDIT INCREASES ESG LOAN
Heavy vehicles leasing company SHINSHIN
CREDIT has increased a three-year loan linked
to ESG metrics to NT$7.5bn from a NT$6bn
target after attracting 11 lenders in general
syndication.
Hua Nan Commercial Bank was the sole
MLAB of the transaction, while Bank of
Taiwan joined as MLA.
The borrowing is now split into a
NT$6.65bn revolving credit tranche A,
a NT$3.99bn guarantee tranche B and a
NT$850m guarantee tranche C.
Tranches A and B cannot exceed
NT$6.65bn combined and are for bank
investors, while tranche C is for bills
finance firms.
Tranche A pays a margin of 70bp over
Taibor, with a pre-tax interest rate floor
of 1.7%, while tranche B offers an annual
guarantee fee of 58bp.
Tranche C pays a margin of 58bp over
Taibir, the Taiwan Bills Index Rate for
short-term bills compiled by the Taiwan
Depository & Clearing Corp.
The margins and guarantee fee will
decrease by 1bp if the borrower meets one
of three KPIs and by 3bp for meeting all
criteria.
The KPIs relate to the rate of increase
for green energy financing amount,
carbon emissions reduction at the solar
power plants and electric vehicle charging
 COUNTRY REPORT VIETNAM

stations, and reduction of annual electricity
consumption.
Proceeds are for working capital
purposes. Signing took place on April 13.
For full allocations, see www.ifre.com.
THAILAND
DEBT CAPITAL MARKETS
›TRUE MOVE DIALS FOR A TRIO
Mobile phone company TRUE MOVE H UNIVERSAL
COMMUNICATION, rated BBB+ by Tris, plans to
offer tenors of two to four years in a triple-
tranche bond offering in May to raise up to
Bt12bn (US$357.4m).
Price guidance has been released in
a filing with Thailand’s Securities and
Exchange Commission. Initial guidance on
the two-year tranche is 2.85%–3%, the three-
year tranche is at 3.25%–3.4% and the four-
year piece is at 3.6%–3.75%.
Subscription to the notes, to be drawn
from a Bt130bn MTN programme, will
open to institutional and high-net-worth
investors from May 13–18.
Bangkok Bank, CIMB Thai Bank, Kasikornbank
and Kiatnakin Phatra are joint lead managers.
VIETNAM
SYNDICATED LOANS
›VPBANK LAUNCHES INTO GENERAL
VIETNAM PROSPERITY JOINT STOCK COMMERCIAL BANK
(VPBank) has launched a US$600m three-
year loan into general syndication.
Maybank and Sumitomo Mitsui Banking
Corp are the mandated lead arrangers,
bookrunners and underwriters of the
bullet borrowing, while Cathay United Bank,
CTBC Bank and State Bank of India came in as
MLABs. SMBC is also the sole coordinator.
The loan pays an interest margin of
155bp over SOFR and carries an unspecified
greenshoe.
MLAs committing US$50m or above
receive a top-level all-in pricing of 180bp
via a 75bp fee, while lead arrangers
coming in for US$30m–$49m earn an
all-in of 176.67bp via a 65bp fee. Arrangers
with US$20m–$29m are offered an all-in
of 173.33bp via a 55bp fee, while lead
managers with US$10m–$19m earn an
all-in of 170bp via a 45bp fee.
A virtual bank presentation is slated for
April 19. Commitments are due by May 23,
with signing slated for June 6.
The financing was launched into senior
syndication in March.
Funds are for general corporate purposes.
In October, the borrower closed a
US$200m two-year loan that drew four
banks in limited syndication. Sumitomo
Mitsui Banking Corp was sole MLAB.
VPBank also signed a US$100m facility
that Japan International Cooperation
Agency and SMBC co-financed. JICA agreed
to lend up to US$75m to the Vietnamese
bank to fund micro, small and medium-
sized enterprises.

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International Financing Review Asia April 16 2022 35

 ASIA DATA
ASIAN SYNDICATED LOAN PIPELINE UPDATES WEEK OF 12 APRIL
Company Currency Size (m) Margin (All-in) Tenor (mths) Facility Arrangers
Australia
OFX Group A$ 100 350 60 Revolver/Term Loan GS
Indonesia
Saptaindra Sejati US$ 350 Revolver/Term Loan 0
Hong Kong
Sun Hung Kai Properties US$ 0 60 Revolver/Term Loan 0
Source: Refinitiv data LPC

LAST WEEK’S ECM DEALS

Stock Country Date Amount Price Deal type Bookrunner(s)
Park24 Japan 13/04/2022 ¥26.3bn ¥1,644 Follow-on (Primary) JP Morgan
CIMB Group Holdings Malaysia 13/04/2022 M$536m M$5.10 Follow-on (Secondary) CIMB, CS
Source: IFR Asia

LAST WEEK’S EQUITY-LINKED ISSUANCE

Issuer Country Date Amount Greenshoe Maturity Coupon/YTM % Premium (%) Bookrunner
CIFI Holdings (Group) China 12/4/2022 HK$588m 3 years 6.95% Credit Suisse, HSBC
Source: IFR Asia

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36 International Financing Review Asia April 16 2022

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