IFRASIA

INTERNATIONAL FINANCING REVIEW ASIA

July 16 2022 ISSUE 1245 www.ifre.com

R&F pushes the envelope on US$4.9bn

of bonds with long maturity extensions

ReNew Power refinances dollar bond

onshore two years ahead of maturity

Missing size targets loses its stigma

in Japan’s topsy-turvy bond market

STRUCTURED FINANCE EQUITIES LOANS PEOPLE & MARKETS

Spreads surge as Korean duo presses Privately owned New SFC disclosure
much as 85bp ahead with summer Chinese borrowers rules for primary
above guidance IPOs to avoid find the going tough issues turn focus
for Aussie RMBS H2 listing rush amid lockdowns on private banks
06 07 08 12
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Upfront
Hair on the name
L
ike biblical strongman Samson, holders of Chinese
high-yield bonds seem to be scared of only one thing:
haircuts.
Holders of Guangzhou R&F Properties’ US$4.9bn in offshore
bonds have given consent to extend the maturity dates by
three to four years, a better outcome than any other cash-
strapped Chinese developers have managed this year.
Several other property companies have convinced holders
of bonds to extend the maturities by six months to a year,
but mainly by warning that they face default within days if
they cannot postpone redemption. R&F is not so desperate,
but has managed to achieve the best result seen so far this
year by convincing bondholders to accept much lower
coupons.
The exercise cost the company less than US$20m in
consent fees, plus payments to the arrangers, but will save
Holders of Chinese high-yield
bonds will do anything to avoid
having to turn their mark-to-
market losses into cash ones.
it around US$110m in annual interest payments, according
to IFR calculations.
What is more, it can opt to make payments in kind for
the first 18 months, allowing it to conserve cash.
The outcome is great for R&F, but bondholders have little
to show for it, besides a pledge that R&F will redeem some
of the bonds early if it manages to raise enough cash from
selling its projects in Malaysia and London.
That’s not as generous as it looks, given that the two
assets are already secured against borrowings that need to
be repaid first.
R&F has dodged court-led restructuring, but as it hasn’t
reduced the principal sum it owes it’s hard to see how this
puts it on a more sustainable footing in the long run.
The company has not exactly built trust with investors
this year. R&F has not yet filed its audited annual results
for 2021, after PwC resigned as auditor in April, and only
six months ago upset bondholders in its last liability
management exercise after markedly overstating the
amount of notes it planned to buy back in a tender offer.
Slashing the size of the tender offer by two-thirds might
have been a genuine mistake, but investors were alarmed that
the company could be so wrong about how much cash it had.
Now, without waiting for an audit to give the full picture,
International Financing Review Asia July 16 2022 1
OPINION INTERNATIONAL FINANCING REVIEW ASIA
investors have rewarded it with a payment holiday and
maturity extensions.
The only explanation seems to be that holders of Chinese
high-yield bonds will do anything to avoid having to turn
their mark-to-market losses into cash ones, either through
restructuring or liquidation.
That’s great news for other issuers, who can point to
R&F’s precedent the next time they need breathing space,
but leaves the region’s bondholders in an even weaker
bargaining position.
Going private
H
ong Kong’s Securities and Futures Commission has
good intentions with its new code of conduct for
bookrunners of primary bond and equity offerings
that will come into force next month, but a loophole looks
like it will weaken the impact.
Part of the rules aim to increase transparency in
order books and prevent murky dealings ranging from
undisclosed proprietary orders to anonymous orders that
are given preferential allocations.
Bankers generally welcome the spirit of the rules, but
aren’t looking forward to applying them to private bank
clients. Asking clients to provide a passport number every
time they want to subscribe to a new issue seems to go
against the promise of discretion in private banking, even
though the ID data won’t be shared beyond the issuer, the
syndicate and the regulator, or used for any other purposes.
Bankers also fear they might annoy tycoons who both invest
as PB clients and provide primary market business as issuers.
The SFC has responded to industry concerns by issuing
clarifications which make the requirements easier to meet,
but also run the risk of enabling bookrunners to dodge them.
Under the new code, PB orders placed with bookrunners
outside Hong Kong will not need identification data for the
end investors. That could result in issuers simply hiring one
bank from Singapore to handle the PB demand every time
they bring a deal.
Part of the problem is that the Asian bond business crosses
borders. The SFC can regulate Hong Kong IPOs or Hong Kong
dollar bond issues without too many complications, but US
dollar bond deals involve issuers, arrangers and investors from
around the region or even further afield.
Any attempt by the SFC to tighten the rules too far risks
moving deal activity to Singapore – which is already a
tempting proposition to many bankers fed up with Hong
Kong’s approach to suppressing Covid-19.
By leaving a loophole in the new rules, the SFC will avoid
driving the bond business away from Hong Kong, but it also
looks like it won’t make the market quite as transparent as
it had hoped.
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Contents
INTERNATIONAL FINANCING REVIEW ASIA
July 16 2022 ISSUE 1245

TOP NEWS STORIES COUNTRY REPORT

BONDS
04 R&F wins support for extension 17 AUSTRALIA
Chinese property developer pushes out
bond maturities by three to four years
20 CHINA

BONDS/LOANS
24 HONG KONG
04 ReNew finds better terms onshore
Local refinancing generates 200bp
in relative savings 27 INDIA

BONDS 29 INDONESIA
06 Japanese issuers slash deal sizes
Investors back off amid power bond
oversupply and rate volatility 30 JAPAN

31 MACAU
STRUCTURED FINANCE
06 RMBS glut trips up RedZed
Australian mortgage securitisations 31 MALAYSIA
face investor push-back

32 NEW ZEALAND
07 EQUITIES Korean issuers brave IPO market
08 LOANS China POE lending slows
08 EQUITIES Emperador delays SGX share sale 32 PAKISTAN
09 LOANS JBIC banks on decarbonisation

32 PHILIPPINES
PEOPLE & MARKETS
REGULATION
12 SFC code makes PBs less private 33 SINGAPORE
Bankers dread greater disclosure of
investors’ details
33 SOUTH KOREA

12 RESTRUCTURINGS Sri Lanka debt talks face delays

13 MARKETS RBNZ tightens by another 50bp
34 TAIWAN
14 IN BRIEF The People’s Bank of China is encouraging Chinese issuers to use at least one
Chinese rating agency for offshore bond issues.
14 WHO’S MOVING WHERE? BoCom International Holdings has appointed Zhu Chen as
35 THAILAND
chief executive officer and executive director of the company effective July 11.

Harry is away 36 VIETNAM

International Financing Review Asia July 16 2022 3

News Underpowered yen bonds 06  RedZed’s red spread alert 06  Korean IPOs 07

R&F wins support for extension

Bonds Chinese property developer pushes out bond maturities by three to four years
„ 

By PAN YUE
GUANGZHOU R&F PROPERTIES has
gained bondholder approval for
a liability management exercise
to push back the maturity dates
of around US$4.9bn of notes,
in a transaction that may set
a new blueprint for China’s
struggling property sector.
Unlike most developers
which have tried to seek one-
year extensions for bonds
maturing imminently, R&F
won approval to extend the
maturities of 10 US dollar
bonds by three to four years.
“It sends a signal to the
market that there’s a way
to have a sustainable debt
structure in place and at the
same time maintaining the
operation as normal to allow
the management to focus
on revenue generation,” said
Rita Chan, head of real estate
investment banking for Asia ex-
Japan at JP Morgan, which was
solicitation agent alongside Arta
Global Markets.
R&F itself had sought a
short-term solution in January, more optimistic, but given for the market, and when
when it won approval to delay the current situation, they are the next payment comes,
the repayment of a 5.75% note more pragmatic nowadays,” there’ll be speculation around
due in that month to July. That said Melvin Yip, managing whether the company will
exercise was controversial, as director at Arta Global Markets, be able to pay,” said Chan.
bondholders had given consent a subsidiary of Arta TechFin, “So we think it’s important
under the belief that R&F a Hong Kong-based financial that all bondholders get the
would buy back US$300m in intermediary. same credit enhancement and
principal of the bonds, only for Compared to a one-year transparent treatment.”
It was not an easy process.
The consent solicitation
required R&F to gain approval
“It sends a signal to the market that there’s for each series of the bonds, or
a way to have a sustainable debt structure in the whole consent solicitation
place and at the same time maintaining the would fall apart. It required 66%
operation as normal to allow the management of the principal of each bond
to focus on revenue generation.” to form a quorum, and at least
75% of those who attended the
meeting to vote in favour.
Since the company extended
the company to say after the extension, R&F’s approach the 2022 notes by three years,
deadline that it would redeem also offered more certainty to and 2023 and 2024 bonds
just US$104m. investors and showed it was by four years, with different
However, market sentiment thinking ahead. amortising repayment
has deteriorated further since “When a company does schedules, this led to concerns
the start of the year. Investors an extension of a deal with from some investors who
see less chance for a quick immediate maturity, all the felt they had been treated
rebound of the property other debt holders down the differently, said bankers.
market, and poor recovery curve will question what it “Once we began
prospects from liquidation. means for them. It will cause a communicating extensively
“Last year, investors were lot of uncertainty and anxiety with investors, they came to

ReNew finds better terms onshore 2027), the company said.

Bonds/Loans Local refinancing generates 200bp in relative savings
„  rate, but said it had saved
By KRISHNA MERCHANT,
MIRZAAN JAMWAL
Indian renewable energy
companies will explore the
rupee market to refinance
maturing US dollar bonds after
RENEW ENERGY GLOBAL managed
to raise amortising project
debt from the local market to
redeem US$525m of notes at a
lower cost than it could obtain
offshore.
State-owned REC is thought
to have provided the credit
facility to ReNew, according
to DCM bankers. This was the
first time an Indian renewables
company was able to raise
rupees to retire US dollar bond
obligations.
“It’s a fabulous transaction
“It’s a fabulous transaction as we are in an
environment where issuers are struggling to
refinance upcoming maturities.”
as we are in an environment
where issuers are struggling to
refinance upcoming maturities,”
said a head of DCM at a foreign
bank, underscoring that the
refinanced bond was not even
coming up for maturity.
ReNew exercised a call
option that became available in
March to pay the outstanding
6.67% bonds due in 2024 at a
cash price of 103.3.
The local refinancing has
a fixed interest rate for three
years, while pushing out the
maturity to the end of fiscal
year 2027 (ending in March
ReNew did not specify the
maturity date or the interest
200bp in rupee terms with the
transaction.
The issuer is heard to have
raised the rupee loan at close
to 9% per annum versus paying
an all-in cost of close to 11% to
refinance the existing bonds,
according to bankers.
“More renewable companies
may explore the rupee loan
route if there is an actual cost
saving for the issuer,” said Sajal
Kishore, head of Asia Pacific
infrastructure and project
finance ratings at Fitch.
OFFSHORE STRUGGLE
Indian issuers have struggled to

4 International Financing Review Asia July 16 2022


Chinese POE loans 08  Emperador joins ECM procrastinators 08  JBIC tackles carbon 10
understand that this approach
balanced everyone’s needs,
with the benefit of time
and cost efficiencies, versus
extending a scheme,” said Amy
Tan, head of DCM for Asia ex-
Japan at JP Morgan.
Had the bonds defaulted and
holders demanded immediate
repayment, the issuer would
have needed to restructure
the bonds under a scheme of
arrangement, a much lengthier
process than a consent
solicitation.
In fact, the issuer was
overdue on interest payments
for some of the bonds included
in the consent solicitation,
which were issued through
offshore vehicle EASY TACTIC, but
they were within their grace
period when the exercise was
launched, a source said.
Earlier this year a default
was triggered on a US$500m
9.5% bond due June 27 2022,
issued through another R&F
subsidiary, Trillion Glory. That
default was triggered by the
downgrade of R&F’s ratings in
December to Caa2/CC/C from
B3/B–/B–, but the issuer was
in the process of obtaining
a separate extension when
the consent solicitation was
issue US dollar bonds as a result
of the war in Ukraine and
aggressive rate increases by the
US Federal Reserve.
Greenko Wind Projects
(Mauritius) managed to raise
US$750m from three-year
non-call two green bonds in
March at 5.5%, but CONTINUUM
GREEN ENERGY and SUKHBIR AGRO
ENERGY (SAEL) were not able to
complete planned deals.
Instead, Continuum placed
US$350m of bonds privately
with two unnamed investors on
Thursday. (See India Debt Capital
Markets)
“The dollar bond market is
very weak, very volatile and it
is not possible for most high-
yield issuers to refinance at the
moment,” said Trung Nguyen,
launched. It has also agreed an
extension with the sole holder
of a defaulted private note due
February 28 2022 issued by
Globe Times Investments.
As a back-up plan,
the company also asked
bondholders to sign a
restructuring support
agreement alongside the
consent solicitation, which
would have enabled it to
begin a court-led restructuring
more quickly if the consent
solicitation had failed. The
back-up plan required holders
of 75%% of the overall principal
amount to agree.
Bondholders were paid US$5
per US$1,000 in principal
amount for granting consent
and signing the RSA.
SUSTAINABLE TERMS
The objective of the
restructuring was to create a
sustainable maturity profile
for R&F while ensuring it can
maintain operations as normal
– though the amount of debt
has not been reduced.
While there was no haircut
for bondholders, the terms
were not particularly investor-
friendly.
The 10 notes, with a
senior credit analyst for Asian
high yield at Lucror Analytics.
Indian renewable energy
companies would have to pay
an exorbitant price to raise
dollars at present. For example,
“The dollar bond
market is very weak,
very volatile and it is
not possible for most
high-yield issuers
to refinance at the
moment.”
ReNew Power’s 4.5% bonds due
July 2028 are currently yielding
9.39%, according to Refinitiv
data.
Three Indian renewables
International Financing Review Asia July 16 2022 5
total outstanding principal
amount of US$4.9bn, in the
restructuring were a 5.75%
July 2022, a 9.125% July 2022,
a 12.375% November 2022,
a 5.875% February 2023, a
8.125% February 2023, a 11.75%
August 2023, a 8.625% February
2024, a 8.625% March 2024, a
8.125% July 2024 and a 11.625%
September 2024.
R&F swapped the three
2022s with a new US$1.3bn
note due 2025, the three 2023s
with a US$2.2bn 2027, and the
four 2024s with a US$1.6bn
2028. The new principal
amount includes accrued
interest.
The coupon for all the new
bonds is much lower at 6.5%,
and R&F can choose to pay
this in kind for the first 18
months, by adding an amount
to the principal. There are
no principal repayments for
the first 18 months either,
conserving cash for the
developer and allowing it to
focus on generating revenue
and dealing with other
creditors.
The PIK option pays a
higher coupon rate of 7.5%,
incentivising the company
to pay in cash. If it makes
companies have bonds worth
close to a combined US$1.2bn
due by 2024, according to Fitch.
Azure has 5.65% US$350m
notes due in December 2024,
with a call option in September
this year. ReNew’s India Green
Energy Holdings, an orphan
SPV, has US$325m 5.375% due
in April 2024 and Adani Green
Energy has 6.25% US$500m
notes maturing in December
2024. Azure also has a call
option in August 2023 for
US$399m 3.575% bonds due
in 2026, according to Refinitiv
data.
In the rupee market, State
Bank of India, Power Finance
Corp and REC are the main
project finance lenders,
according to Kishore at Fitch.
For daily news stories
visit www.ifre.com
any dividend distribution or
payment on junior debt then it
will need to pay a cash coupon
for the bonds.
To give investors comfort
that it would have funds to
repay them, R&F provided
credit enhancement using
its offshore developments in
London and Malaysia.
If the proceeds from the
disposal of its London assets are
over US$100m, after repaying
debt secured by the assets, they
will be used to redeem the new
bonds, and if net proceeds from
the Malaysia assets are over
US$30m, 60% will be used to
redeem the bonds.
For the 2025 bond, 25% of
the principal will be redeemed
after two years and 60% after
2.5 years, while for the 2027
note, 5% will be redeemed after
2.5 years, 10% after three years,
30% after 3.5 years, 50% after
four years and 70% after 4.5
years.
The 2028 note will have 5%
of the principal redeemed after
three years, 15% after 3.5 years,
25% after four years, 40% after
4.5 years, 60% after five years
and 80% after 5.5 years.
Morrow Sodali was tabulation
and information agent. 
While the Reserve Bank
of India has started sucking
out excess liquidity from the
financial system and raised
repo rates by a total of 90bp
since May, domestic lenders
have been slow to transmit
the increase. They are keen to
deploy capital in projects with
a good track record as they are
still flush with surplus cash,
said bankers.
“There is lower risk in
refinancing a project, so any
bank would like to do that,”
said a senior banker in charge
of infrastructure finance at a
domestic state-owned bank.
The refinanced ReNew bonds
were issued by a restricted
group of solar and wind power
plants. 
News
Japanese issuers slash deal sizes
Bonds Investors back off amid power bond oversupply and rate volatility
„ 
By TAKAHIRO OKAMOTO
The Japanese domestic bond
market saw many deals
undersubscribed this month, as
electric power companies took
the plunge to sell bonds even if
they knew they could not meet
their size targets.
Volatility in government
bonds has reduced investor
demand for corporate issues,
and heavier than usual supply
from power companies has
weighed on the market.
J-POWER only raised ¥23.9bn
(US$173m) from a planned
¥30bn three-year bond sale.
HOKURIKU ELECTRIC POWER drew
RMBS glut trips up RedZed
Structured Finance Australian mortgage securitisations face investor push-back
„  about the fundamentals of the
By JOHN WEAVERS
Non-bank lender REDZED
issued the A$500m (US$346m)
REDZED TRUST SERIES 2022-2 non-
conforming RMBS offering on
July 8, but had to pay up for
the privilege as the mezzanine
tranches, in particular, priced
well wide of initial guidance.
NAB, which was arranger
and joint lead manager for
the transaction with CBA
and Westpac, cited “a general
widening in global credit spread
between guidance and pricing”.
However, a syndicate banker
away from the deal said that
while this may justify pricing
on the Class A1 tranches, it does
not explain what happened
further down the capital
structure.
The A$100m of Class A1-S
and A$275m of Class A1-L notes,
with 0.7 and 2.3-year weighted
average lives, priced at one-
month BBSW plus 115bp and
175bp versus 105bp–110bp and
170bp area initial price talk
released on June 28.
Mark-ups for the A$70m of
Class A2 and A$25m of Class
6 International Financing Review Asia July 16 2022
just ¥16.6bn for a three-year
tranche and ¥7.3bn for a 10-
year portion even though it
was initially looking to raise
¥20bn and ¥10bn, respectively.
CHUGOKU ELECTRIC POWER only
attracted ¥14.6bn of demand
for a three-year bond offering,
less than the ¥30bn it had
aimed for, and CHUBU ELECTRIC
POWER printed a ¥9.2bn 20-year
deal, versus the planned ¥10bn.
Such undersubscription
affected not just electric power
companies but also other
issuers in different industries
such as KAWASAKI HEAVY. The
Japanese manufacturer was
planning to sell its inaugural
B notes, with 2.3 and 3.5-year
WALs, were more significant as
these tranches came 250bp and
300bp over one-month BBSW,
or 25bp and 40bp beyond initial
225bp area and 260bp area
guidance.
For the A$12m of Class C,
A$8.5m of Class D and A$4.8m
of Class E notes, all with 3.5-year
WALs, clearing rates of 375bp,
420bp and 620bp were 85bp
more than initial price talk in
each case.
“In all my years in the market
I don’t recall credit spreads
pricing 85bp wide of guidance,
something that cannot be
attributed to the market
backdrop alone,” the banker
said.
“Times are difficult and
investors are becoming more
selective in what they choose to
invest in. Indigestion, following
the glut of RMBS supply this
year, is another contributing
factor in a weak market, while
RedZed’s relatively short track
record in non-conforming RMBS
may limit the size of its loyal
investor base compared with
other issuers,” he suggested.
green bond worth ¥10bn in
the 10-year segment, but the
demand was just ¥9bn.
DISMAL OUTLOOK
Investors held back partly
because of an avalanche of
supply from power companies.
According to DealWatch, IFR’s
sister publication, they issued
¥1.0879trn of bonds in the
April to June quarter, half of
what they had issued in the
previous fiscal year ended in
March.
Worries about power
companies’ earnings also put
a brake on demand. Japanese
rating agency R&I warned in
Fellow non-bank lender
PEPPER MONEY is faring no better
with its 33rd non-conforming
RMBS, PEPPER PRS33, which was
originally supposed to price last
week. It had its indicative issue
size halved to A$500m from the
original A$1bn-dual-currency
offering with a planned senior
US dollar note now dropped.
Furthermore, launch and
pricing has been delayed to this
week, while guidance remains
unchanged, bang in line with
the RedZed sale for all tranches.
NAB is arranger and joint lead
manager with CBA, Macquarie,
Standard Chartered and Westpac
for Pepper PRS33.
The previously booming
Australian housing market is
being hit by declining house
prices and rising mortgage
interest rates, though this
weakness was not referenced as
a significant factor behind the
struggling RedZed and Pepper
RMBS trades.
The syndication banker said
it was too soon to say how
much rising mortgage costs
were fanning any upturn in
repayment arrears, while NAB
its outlook report in May that
the business environment
for power companies would
remain severe for the time
being because of the sudden
spike in energy costs and
the adverse effects resulting
from Japan’s electricity
system reform. “Because of
the rise in energy costs, it
became apparent that many
of the new rules introduced
by the electricity reform
have problems and resulted
in pressuring their balance
sheets,” R&I said.
The reform, meant to address
the weakness of Japan’s power
system exposed by the 2011
noted: “During the (RedZed)
marketing campaign, investors
had not indicated any concerns
Australian housing market.”
“With 95% of the pool
with no credit impairment, a
conservative LVR [loan-to-value
ratio] of 67.5%, 100% variable
mortgage rates in the pool, and
prudent serviceability stress
testing at origination to resilient
self-employed borrowers, the
pool and RedZed also gave
investors confidence about the
robustness and quality of the
collateral,” NAB told IFR.
The A$2.9m of Class F notes
with a 2.6-year WAL priced in
line with 750bp area guidance,
while the A$1m of Class G1 and
A$0.8m of Class G2 notes were
retained.
Respective credit support for
the Class A1 to E notes is 25%,
11%, 6%, 3.6%, 1.9%, 0.94%, 0.36%
and 0.16%.
Australian investors bought
75% of the notes and offshore
25%.
RedZed, which specialises in
lending to the self-employed
and those who self-certify
incomes, issued the A$750m
RedZed Trust Series 2021-2 NC
RMBS last August, when market
spreads were at or very near
their cyclical lows. 

earthquake, focuses on cross-
regional power transmission,
the liberalisation of the retail
electricity market, and the
separation of transmission and
distribution businesses with the
aim to stabilise supply, lower
prices and increase consumer
choice.
VICIOUS CYCLE
The rise in yen rates and
volatility since June was
undoubtedly a factor in the
unusual outcomes for new
issues. Dealers had to reduce
their positions to protect
against volatility, making it
difficult for investors to unload
existing power company bonds
to switch to new ones.
Volatility was elevated
further in mid-June after the
Bank of Japan unexpectedly
Korean issuers brave IPO market
Equities More companies are expected to launch deals later in the year
„  insurer had already deferred
By SUNNY TSE
South Korean issuers are
planning to raise at least
W1.1trn (US$838.6m) from KRX
IPOs next month despite tough
market conditions, though
KYOBO LIFE INSURANCE is likely to
miss out after its preliminary
application was rejected by the
bourse.
Lithium-ion batteries
separator maker W-SCOPE CHUNGJU
PLANT plans to raise W900bn,
which would be the second-
largest IPO in the country
this year after the far larger
W12.8trn LG Energy Solution
float in January.
“It is surprising to see a
sizeable deal planning to
launch in August, given the
challenging market, while
fund managers are mainly on
holidays during this period,” a
Korean ECM banker said.
WCP is offering 9m shares
(7.34m primary/1.66m
secondary) at W80,000–
W100,000 each, which implies
a market capitalisation of
W2.72trn–W3.4trn.
Bookbuilding will run
intervened in the JGB market
to buy the cheapest-to-deliver
futures. This forced traders
with massive long positions
on futures and shorts on cash
bonds to unwind them, and
totally broke the correlation
between futures and cash
bonds.
“The market is in a vicious
cycle,” said a Japanese banker
in an apparent dig at the
BoJ, which often refers to its
monetary easing as a virtuous
cycle that helps the economy.
“Dealers cannot expand their
inventories in the secondary
market, so investors are
backing off, so issuers need
to pay extra premium, and
dealers end up with damaged
inventories.”
Sources said life insurers,
pension funds and regional
from August 1–2 and retail
subscription from August 8–9.
The listing is scheduled for
August 18.
TSE-listed W-Scope, which
will own 35.6% of WCP after
the IPO, is subject to a 1.5–2.5-
year lock-up.
KB Securities and Shinhan
Investment are leading the float.
SoftBank-backed car-sharing
service provider SOCAR will
open the books from August
4–5 for a W205bn IPO. It
slightly delayed the timetable
from August 1–2 to update
the revised prospectus with its
first-half financials and to avoid
launching the deal at the same
time as WCP.
“For a block, hedge-fund
driven deals are reasonable,
but for IPO deals we need long-
only funds for leadership and
they are staying away,” an ECM
banker said. “IPOs nowadays
are much more difficult to get
across the line.”
Despite the challenging
market, IPO activity is expected
to pick up in coming months.
“There will be more
companies waiting to launch
International Financing Review Asia July 16 2022 7
accounts are keen to sell
existing bonds in the secondary
market but cannot find
meaningful bids from dealers
and hence are refraining from
participating in new deals.
To work around these
constraints, bankers have
advised issuers to sell bonds in
odd maturity segments or add
a new tranche wherever they
find demand. JERA managed
to raise ¥10.1bn for a six-year
tranche and ¥10.3bn for a 25-
year bond. KYUSHU ELECTRIC POWER,
in its attempt to raise ¥26bn in
the three and 18-year tenors,
failed to draw enough demand
at the shorter tranche, but was
able to raise more than planned
by hurriedly adding a six-year
tranche during marketing.
Kawasaki Heavy chose to
reduce the deal size as it did
IPOs in the second half of this
year. We are expecting Q4 to
be another period for issuers
to test the water,” said Jinsoo
Ha, head of ECM for Korea at JP
Morgan.
Companies will have a look
at their first-half results and
Fed policy in the US, as well as
market conditions at the time,
before they decide whether to
launch their offerings, she said.
GOLFZON COUNTY and HYUNDAI
OILBANK are considering
launching IPOs in Q4 which
could raise US$500m and
US$1.5bn, respectively.
NH Investment and Securities,
Samsung Securities and Morgan
Stanley are working on the
Golfzon County deal. NH
Investment and Securities, KB
Securities and Credit Suisse are
leading the Hyundai Oilbank
IPO.
IPO REJECTED
Kyobo Life Insurance, South
Korea’s third-largest life insurer
by assets, said Monday it will
press ahead with its planned
IPO despite the rejection of its
preliminary application by the
For daily news stories
visit www.ifre.com
not want to pay a higher
coupon.
NO LONGER EMBARRASSED
In the past, undersubscribed
deals were rare in the domestic
market, as issuers either
decided not to go ahead if
they could not find sufficient
demand or bookrunners added
the unsold paper to their
inventories. Power companies,
however, expect interest rates
to continue to go up and hence
took the plunge to sell bonds
at any size possible instead of
waiting until rates stabilise.
“Issuers no longer feel
embarrassed about reducing a
deal size,” said a second banker.
“You look awful if you are the
only one that reduced a deal size,
but you are not the only one, so
you just go ahead and do it.” 
bourse operator on July 8.
Korea Exchange did not
explain its decision, but the
the float for more than two
years over a dispute with a
consortium of investors before
it filed for preliminary approval
in December last year.
The consortium, led by
private equity fund Affinity
Equity, had exercised a put
option to sell a 24% stake in
the insurer back to company
chairman Shin Chang-jae, but
he refused to buy back the
shares.
“If the company is not able to
solve the shareholder dispute,
the regulator will never allow it
to be listed,” a person familiar
with the situation said.
Kyobo Life had planned to
raise US$1bn in late 2019 before
the dispute put the IPO on ice.
“We haven’t finalised how
much it is aiming to raise but
the deal will be much smaller
than US$1bn,” a person close to
the deal said.
“The best scenario is the
company resolves the dispute
as soon as possible and applies
for a fast-track listing review,
which takes 20 business days,”
the person said.
NH Investment and Securities is
leading the float. 
News
China POE lending slows
Loans Loan volumes for private sector borrowers plunge 31% in first half
„ 
By APPLE LI
Chinese privately owned
enterprises are finding it harder
to access the syndicated loan
markets due to the country’s
economic slowdown, its zero-
Covid policy that has prompted
lockdowns across different
provinces and the ongoing real
estate debt crisis.
Loan transactions from
POEs have taken much longer
to close, with some property
sector borrowers facing
lacklustre interest, thus leading
to a decline in overall volume.
“With the backdrop of global
economic uncertainties, there
is enhanced credit focus within
internal risk departments, and
in a Greater China context,
a lot of employees across
businesses are working from
home, causing further delays,”
said a Hong Kong-based senior
loan banker.
The crisis in the real
estate sector – which used
to contribute to a significant
Emperador delays SGX share sale
Equities Philippine distiller joins list of wait-and-watch issuers in South-East Asia
„  positioned to broaden our
By S ANURADHA
EMPERADOR became the first
Philippine company to have
a secondary listing on the
Singapore Exchange, but
investors will have to wait
before the spirits producer
launches a follow-on to
improve liquidity.
The company aims to launch
the delayed S$300m (US$214m)
share sale in September,
subject to an improvement in
market conditions, people with
knowledge of the transaction
said.
The follow-on, first planned
for last year and already
downsized from earlier
8 International Financing Review Asia July 16 2022
chunk of China’s loan and
bond volumes – and regulatory
crackdowns across a broad
range of industries from
technology to education are
posing additional challenges to
some borrowers.
In June, vocational education
provider HOPE EDUCATION GROUP
had to cut a HK$1bn (US$127m)
three-year borrowing to
HK$620m after a challenging
five-month syndication
LENDING TO CHINESE CORPORATES (US$BN)
160
140 SOE
POE
120
100
80
60
40
20
0
1H2018 1H2019 1H2020
Source: Refinitiv data LPC
expectations of S$1bn, was pre-
marketed last month but did
not draw sufficient appetite.
“The markets are not
showing any signs of
“This secondary listing leverages Singapore’s
position as a global financial hub and will
ensure we are well-positioned to broaden
our access to the international investment
community in the future.”
settling and it is hard for the
management to get the pricing
right,” a Singapore-based ECM
banker said. “The good news
is that the whisky and brandy
businesses are improving
after the Covid-19 pandemic
process, and attracted three
banks. It was the first offshore
syndicated deal from the
country’s education sector since
sweeping rule changes were
introduced last July.
Tutoring services focused
on the core public school
curriculum were banned from
making profits, and class
schedules were restricted to no
later than 9:00pm on weekdays.
While Hope Education provides
1H2021 1H2022
and there is decent investor
interest.”
Listing on a regional stock
exchange such as SGX is aligned
with Emperador’s international
expansion strategy. Bryan
Donaghey, head of Emperador’s
whisky business, said the
company plans to generate 50%
of its sales from outside the
Philippines by 2025.
“This secondary listing
vocational education services,
which are encouraged under
national policies, lenders’
appetite for the sector overall
was hurt.
In March, only four banks
joined in syndication the
US$933m loan backing
investment firm PAG’s
acquisition of a 10% stake in
Chinese conglomerate Dalian
Wanda’s commercial property
management business, Wanda
Light Asset Commercial.
PAG’s loan was launched
over a challenging period for
the property sector after China
Evergrande Group defaulted on
its debt last year.
That said, state-owned
developers are still able to
garner liquidity from key
relationship banks. MINMETALS
LAND, the real estate flagship of
state-owned China Minmetals,
completed a HK$3.5bn club
loan with 11 banks in June.
“There is risk aversion
creeping in as people get more
concerned with economic
leverages Singapore’s position
as a global financial hub
and will ensure we are well-
access to the international
investment community in the
future,” he said.
Emperador will keep
its primary listing on the
Philippine Stock Exchange.
On its Singapore debut on
Thursday, the shares closed
at S$0.45 or Ps18.07, slightly
below the PSE close of Ps18.10.
Overall 6.2m shares were
traded on SGX.
DELAYS IN SE ASIA
Emperador is not the only one
facing delays. Other issuers
in South-East Asia are also
reluctant to launch IPOs as
investors are demanding steep
discounts.
In Indonesia, PERTAMINA
 For daily news stories
visit www.ifre.com

growth, and there’s strong year of moderate growth, remain strong “for the right HK$3bn from HK$2.3bn
preference for SOEs versus highlighting lenders’ increasing borrowers in the right sectors”. after 15 lenders joined in
POEs any day,” said a second preference for credits with In May, Shenzhen-listed syndication.
Hong Kong-based senior loan However, the outlook
banker. “Some POE deals do for POE-related offshore
“There is risk aversion creeping in as people get
require harder work than transactions will remain weak
others, but I wouldn’t say
more concerned with economic growth, and in the months to come given
that the market is completely there’s strong preference for SOEs versus POEs the People’s Bank of China’s
shut for these names. We are any day. Some POE deals do require harder work recent cut in its benchmark
fortunate that there are enough than others, but I wouldn’t say that the market reference rate, thus prompting
banks.” is completely shut for these names. We are these corporates to turn to the
Syndicated and club loan onshore market for cheaper
volumes for Chinese POEs have
fortunate that there are enough banks.” funding.
declined 30.9% to US$95bn In May, the Chinese central
in the first half of this year state support amid increasing waste recycling firm GEM bank cut the five-year loan
compared to US$137.4bn over market uncertainty. doubled its debut three- prime rate, which is the
the same period a year ago, year borrowing to US$200m reference for mortgages,
according to Refinitiv LPC data. BLEAK OUTLOOK after attracting 11 lenders in from 4.6% to 4.45%, in a bid to
Conversely, syndicated While lending to Chinese POEs syndication, while IT software revive the country’s slowing
lending to Chinese SOEs grew has become more selective, provider CHINASOFT INTERNATIONAL economy.
6.4% to US$11.18bn, a third bankers believe liquidity will lifted a three-year loan to “The 15bp cut is more than
what the market had expected,”
CHINESE POE LOANS COMPLETED IN OVER THREE MONTHS said a third Hong Kong-based
Borrower/Guarantor Loan size Launched Completed Number of banks joining loan banker. “Apart from
PAGAC Wonderland US$933m December March 4 borrowing at a cheaper cost
Tianshan Aluminum Cut from US$150m to US$127.5m January May 5 onshore, companies are also
Chindata Group Increased from US$300m to US$500m January June 13 free from withholding tax and
Hope Education Cut from HK$1bn to HK$620m January June 3 the hassle of having to obtain
Wolong Electric Increased from €200m to €250m February May 16 NDRC [National Development
GEM Hong Kong International Increased from US$100m to US$200m February May 11 and Reform Commission]
Digital China Group US$500m-$700m March July ~8–9 approvals for guarantees.
LB Group US$300m March June 9 I won’t be surprised to see
Chinasoft International Increased from HK$2.3bn to HK$3bn March June 15 stronger demand for onshore
Betterlife Holding HK$780m April – – borrowing, at the expense of
Source: Refinitiv data LPC offshore transactions.” 

GEOTHERMAL ENERGY and CSM
CORPORATAMA are yet to open
books for respective US$500m
and US$250m IPOs despite
completing investor education
in May and June, respectively.
Telecommunications
network access provider
MORA TELEMATIKA INDONESIA
(Moratelindo) has launched
a smaller-than-expected IPO
of up to Rp1trn (US$69m) in
a Rp368–Rp396 range with
a truncated syndicate. The
company was initially targeting
a US$200m–$300m IPO when it
pre-marketed the deal in May.
“Moratelindo has accepted
market reality and is willing to
sell a much smaller deal. Other
issuers will not accept such an
option,” an ECM banker away
from the deal said.
Up to 2.6bn primary shares,
or 11% of the capital, are on offer.
Institutional books will close
on July 18 and the retail offer
will run from July 29–August 2.
At present, 45.71% and
33.78% of Moratelindo’s shares
are owned by investment
companies Candrakarya
“Moratelindo has
accepted market
reality and is willing
to sell a much smaller
deal. Other issuers
will not accept such
an option.”
Multikreasi and Gema Lintas
Benua, respectively, and 20.51%
by Smart Telecom.
BNI Sekuritas and Sucor
Sekuritas are the banks on the
transaction. BNP Paribas and
Credit Suisse were originally
attached, but are no longer
working on the IPO.
In Thailand, A-COMMERCE
GROUP has not opened
books for a domestic IPO of
around US$200m although
pre-marketing ended on
June 24. The delay is a rare
occurrence as Thai IPOs rarely
get downsized or postponed
after the pre-marketing stage,
thanks to good support from
local institutional and retail
investors.
Meanwhile, Thai Beverage’s
regional beer business BEERCO
is yet to open books for a
US$800m–$1bn SGX IPO even
though pre-marketing ended in
early July.
Vietnamese carmaker VINFAST
TRADING AND INVESTMENT has
deferred a planned US$2bn–
$3bn IPO in the US to next year
and is exploring other funding
options in the meantime. It
has appointed Citigroup and
Credit Suisse to help raise at least
US$2bn each through debt or
equity in the offshore markets.
Each agreement “could include
debt or private placements of
equity,” VinFast said without
giving details. The funds will
be used to build its planned
electric vehicle factory in North
Carolina, which is expected to
require US$2bn of investment
in its first phase, and fund its
US expansion.
JP Morgan, UBS, Credit Suisse,
Citigroup, CLSA and HSBC are
working on the Emperador
share sale.
Emperador is owned by
billionaire Andrew Tan’s
Alliance Global Group. Its
shares on the PSE are down 13%
so far this year. 

International Financing Review Asia July 16 2022 9

News
JBIC banks on decarbonisation
Loans Export credit agency launches new global investment facility amid volatility
„ 

By WAKAKO SATO
JAPAN BANK FOR INTERNATIONAL
COOPERATION has launched
a global investment
enhancement facility to
support Japanese companies’
decarbonisation and supply-
chain resilience efforts after
an earlier initiative to support
foreign M&A drew little
interest.
Effective July 1, the new
facility – which comprises a
sustainability window and a
global value chain resilience
window – replaced the post-
Covid growth facility launched
in January 2021 to support the
overseas expansion of Japanese
companies.
“The surrounding issues
such as the US-China conflict,
coronavirus pandemic and
more recently Russia’s
invasion of Ukraine all made it
apparent what tasks Japanese
companies are facing,” said
Akifumi Fujii, deputy director
of operation policy and strategy
coordination division at JBIC’s
corporate planning department.
“The situation has changed
from an emergency response
at the height of the pandemic
to more forward-looking
efforts to deal with these tasks.
Among such efforts, I believe
supply chain, decarbonisation
and innovation have become
important keywords.”
JBIC, which primarily
focuses on emerging markets,
is also enhancing its lending
capabilities to developed
countries.
The Japanese export credit
agency expanded eligible
sectors in developed countries order to do some serious work,” DROP IN OUTBOUND M&A
to include medical equipment, Fujii said, noting that such JBIC provided ¥563.4bn
biopharmaceuticals, fuel facilities usually have timelines (US$4.109bn) under the previous
ammonia, electric vehicles of one to 1.5 years. post-Covid growth facility in the
and semiconductors from the Japan is trying to reduce its fiscal year ended in March of
existing infrastructure sector, reliance on coal-fired power this year, falling well short of the
effective June 30. This follows stations, which increased in ¥1.5trn target, mainly because of
the cabinet’s decision on June the wake of the Fukushima a lack of jumbo acquisition deals.
Japanese companies’ overseas
acquisitions, which drove the
“The situation has changed from an emergency volume because deal sizes tend
response at the height of the pandemic to to be large, slowed down in
more forward-looking efforts to deal with these the wake of the coronavirus
pandemic.
tasks. Among such efforts, I believe supply Outbound M&A volume by
chain, decarbonisation and innovation have Japan Inc decreased 46.7% to
become important keywords.” US$18.95bn with 345 deals in
the first half of 2022 compared
to the same period last year,
28 to revise the enforcement earthquake in 2011, when according to Refinitiv data.
order of the JBIC Act to allow damage to a nuclear power The volume hit a record
new sectors to be added. plant caused a radiation leak. US$114.29bn with 426 deals for
“While talking with various The Ministry for Economy, a first half in H1 2018.
companies during the Covid-19 Trade, and Industry estimates JBIC’s overall investments
emergency response period, the demand for fuel ammonia including the post-Covid
we were able to identify which to reach three million tons by growth facility also dropped
fields truly have funding 2030 and 30 million tons by 20.5% to ¥2.066trn in FY2022
needs. We discussed it with 2050, according to its roadmap for the same reasons.
the Japanese government and announced in February 2021. A target amount has not been
decided to expand the sectors,” Ammonia, traditionally set for the global investment
Fujii said. used as a fertiliser, raw enhancement facility, but the
chemical or refrigerant, can expanded scope for funding
NEW ADDITION also be burnt as a carbon-free under the new facility will open
JBIC has supported various fuel in gas turbines, co-fired doors for new opportunities,
renewable energy projects with pulverised coal, and according to Fujii.
as well as hydrogen-related in industrial furnaces. The With the recent drop of
projects for clean energy under Japanese government has the Japanese yen to a 24-year
previous facilities to help Japan funded research into such uses low, JBIC’s US dollar liquidity
achieve its zero carbon goals by since 2014 as part of a project might also come in handy for
2050. Fuel ammonia has now to develop hydrogen-based Japanese companies’ overseas
been added to the list under the energies. investments as Japanese
new facility, which runs for the In order to meet the rising commercial banks have a
next three years. demand, major Japanese limited pool of US dollar funds.
“Fuel ammonia and hydrogen companies are now ramping up “First of all, we need to make
are the projects that we need to investments across the supply the new facility known to
work on in the long term. We chain. Japanese companies, cultivate
have set the facility deadline to “Efforts for commercialisation demands and chalk up a track
a relatively long three years in will accelerate,” Fujii said. record,” Fujii said. 

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10 International Financing Review Asia July 16 2022


Funding Asia’s net-zero transition
Financing companies’ transitions to net-zero emissions is challenging. The unique
flexibility of sustainability-linked bonds (SLBs) may be a key to achieving their green goals.
A
ttaining net-zero for the planet will
be impossible if companies don’t
reduce their carbon footprint. Still, the
transition journey is complicated and financing
can be especially tricky. That is where
sustainability-linked bonds can prove useful.
SLBs are a nascent instrument yet in a short
time the market has taken off. Asia Pacific saw
US$0.2bn of deals sold in 2020, but by last
year the volumes had grown more than 70
times to US$15.1bn-equivalent.1
Companies’ interest in sustainable bonds
is matched by their popularity with investors.
While investors were generally shying away
from long-dated bonds in April, Australia-
based property investor Goodman managed
to sell a $500m 10-year SLB at 185bp over
Treasuries, tightening around 15bp from initial
thoughts.2
VERSATILE STRUCTURE
The versatile structure of sustainability-linked
bonds is key to their appeal. Unlike green or
transition bonds whereby the sustainability
component primarily involves the bond’s use
of proceeds, SLBs motivate the issuer to meet
certain key performance indicators (KPIs), like
reducing carbon emissions during the life of
the bond otherwise the issuer faces a penalty,
usually in the form of a coupon increase.
The verification process necessary to prove
whether a company has met its sustainability
KPIs also tends to be robust.
“This is a very specific feature on SLBs. In
the past, for green, social and sustainability
bonds, the post issuance verification was
optional for issuers,” said Luying Gan, Head
of Sustainable Bonds, Debt Capital Markets
Asia-Pacific, Global Banking, HSBC. “However,
for SLBs the actual performance on the
KPIs is required because of the close link to
economic payouts.”
On the recent US$230m bond for Yunnan
Provincial Energy, the 5.3% coupon will
step up if the company does not increase
wind generation or solar power capacity by
stipulated amounts by the end of 2023.
Yunnan’s bond, for which HSBC acted as
1
Dealogic, 1 June 2022; 2
HSBC mandate, Goodman US Finance Five LLC, April 2022;
sole green structuring advisor, was the first
US dollar bond in Asia Pacific labelled both
as a SLB and a green bond (“Double ESG”
bond), which strengthened its sustainability
credentials and broadened investor appeal.3
Norbert Ling, ESG Credit Portfolio Manager
at Invesco Fixed Income Asia Pacific, said
that SLBs show a firm commitment by issuers.
“In transition situations, SLBs could be
more relevant as not every sector is capital
expenditure heavy and suited to sell green
bonds,” said Ling.” If you look at the consumer
sector like supermarkets, these companies are
focused on operational expenses rather than
project level expenses – and this is where
SLBs have a big role to play.”
Nneka Chike-Obi, APAC Head of ESG
research at Fitch, agrees that the flexibility of
the product is a big appeal.
“In my view, SLBs are filling in the space
for what could have been transition-labelled
bonds because it allows companies to show
progress over time,” she says.
UNIQUE MARKET
With China taking less than seven years from
pricing its first green bond to now being one
of the world’s largest green bond markets, it
is likely that the country will be one of the key
markets for sustainability-linked bonds too.
Total volumes for sustainable bonds
(including green, social, sustainability and
sustainability-linked bonds) in China reached
nearly US$500bn in the first half of 2021,
59% higher than the same period in 2020,
according to Climate Bonds Initiative. Within
this, sustainability-linked bond volumes,
onshore and offshore, continued to grow.
“SLBs are a very innovative product that
was only introduced to China’s onshore
market in 2021, proving how the country is
always interested to learn about international
developments,” said Tim Yip, Head of Debt
Capital Markets, HSBC China. “China’s
domestic investor base love the product
because it pushes the green finance agenda
to a new level.”
In China’s onshore market, the SLB market
3
HSBC mandate, Yunnan Provincial Energy Investment Group, April 2022
Produced in association with HSBC
PRODUCED IN ASSOCIATION WITH HSBC
understandably has its own specific national
identity. China’s National Association of
Financial Market Institutional Investors worked
closely with HSBC to produce the 10 Question
and Answers on SLBs released in April 2021,
which acts as a market framework.
“The Q&A provides much more emphasis
on the Chinese social angle such as poverty
alleviation,” says HSBC’s Gan. “It also offers
more diversified structures on SLBs including
that coupon step-downs be allowed.”
“First and foremost, we need to get issuers
to give this product a try,” said HSBC’s Yip.
“And then we can finesse the details as the
product evolves.”
Structurally, onshore SLBs are rarely longer
than five years, and state-owned enterprises
(SOEs) in the energy or utility sectors have
made up the majority of issuers.
“As the nature of the issuers are mainly
SOEs, they have high standards on pricing,”
continues HSBC’s Yip. “The challenge is to get
issuers to really comprehend that SLBs are
a long-term strategic investment because it
always boils down to seeing a pricing benefit
immediately.”
SHOWCASING ESG STRATEGIES
Looking forward, Invesco’s Ling also hopes
that issuers throughout Asia Pacific issue SLBs
not only as a one-off exercise, but along their
whole curve.
Time and experience will naturally bring
a greater variety of SLB structures, be it an
extension of tenors, a greater variety of KPIs or
more diverse issuers.
One way to develop the market would be for
international issuers to sell SLB Panda bonds
onshore in China. This would encourage a
greater understanding of the differences of the
onshore and offshore markets, says HSBC’s Yip.
Whether onshore or offshore, it is clear
that SLBs have the ability to not only act as
a pivotal instrument for transition financing
but also to give companies the opportunity
to commit to and showcase their own ESG
strategies.
By Tanya Angerer
 People
& Markets
TOP STORY REGULATION
SFC code makes PBs less private
Bankers dread greater disclosure of investors’ details
Bankers are expecting new rules for equity
and debt offerings in Hong Kong to upset
private banking clients, due to increased
disclosure requirements.
Among other things, the Securities and
Futures Commission’s new code of conduct
for bookbuilding, which takes effect
on August 5, aims to stop bookrunners
in primary deals inflating orders and
disguising proprietary demand.
In some deals, bookrunners have been
known to place anonymous “X orders”,
purportedly to protect the identity of
publicity-shy investors like sovereigns and
agencies, but the practice is sometimes
misused to win a favourable allocation
or disguise that the order comes from a
related party. It has in the past also caused
problems in a small number of deals where
the same order was included twice, or
when a party related to an issuer was found
to have bought securities without declaring
their connection.
“This is going to be a
nightmare. There is no way
Hong Kong tycoons are going
to go along with this.”
As part of measures to improve
transparency and curb bad behaviour by
bookrunners, the SFC will require the
identities of all investors to be disclosed to
the issuer and the “overall coordinator” – a
new title for the bank that takes the main
responsibility for running a new issue.
Sri Lanka debt talks face delays
SRI LANKA’sdebt restructuring looks like
becoming a drawn-out affair following the
collapse of the island’s government last
week. On Thursday, president Gotabaya
Rajapaksa resigned after fleeing to
Singapore.
He had left the country on Wednesday
following mounting protests against the
economic situation, which has seen Sri
Lanka’s foreign exchange reserves dwindle
to virtually nothing, making it unable
to import vital fuel, medicine and other
supplies.
12 International Financing Review Asia July 16 2022
Bookrunners will have to provide proof
of the identity of every end investor, in the
form of ID card data or passport numbers.
If they cannot obtain this information, they
will need to refuse the order.
That will be straightforward for fund
managers and financial institutions, but
could cause difficulties when it comes
to private bank investors, who have
expectations of secrecy.
“This is going to be a nightmare,” said a
DCM banker. “There is no way Hong Kong
tycoons are going to go along with this.”
Another banker said that some
deals might have heavy private bank
participation, increasing the amount of
paperwork involved.
“If there are dozens of PB clients behind
the PB order, it’s too much,” said the
banker.
It is not clear, though, what powers the
SFC has to seek information about overseas
private bank investors.
A third banker said that, based on his
bank’s understanding of the rules, the SFC
would not be able to compel bookrunners
to provide ID information for private bank
clients with accounts outside Hong Kong.
“If you are at a bank in Hong Kong, you
are going to set up additional accounts in
Singapore for your Hong Kong clients so
they don’t have to comply with this,” he
said.
POSSIBLE LOOPHOLES
In clarification comments published in
May, the SFC appeared to create loopholes
Rajapaksa had appointed Lazard and
law firm Clifford Chance to advise on
restructuring Sri Lanka’s US$51bn of debts
at the end of May. The country has already
defaulted on its US$12.5bn of international
bonds. A US$1.25bn 2023 note fell five
points last week to be bid at just 24.25
cents in the dollar.
The outgoing government had also
started negotiations with the International
Monetary Fund about a possible loan. The
IMF said on Thursday it hoped to resume
discussions at government level “as soon as
for DCM banks to dodge the requirement.
If a syndicate is made up entirely of
banks in Hong Kong, the requirement to
disclose investor identities still applies.
However, if a deal is jointly controlled
by Hong Kong banks and overseas banks
and a PB order is placed with an overseas
bank, the Hong Kong banks only need
“If you are at a bank in Hong
Kong, you are going to set
up additional accounts in
Singapore for your Hong Kong
clients so they don’t have to
comply with this.”
to take “reasonable steps” to request the
information from the overseas banks, and
can accept the order even if no information
is received. That means that appointing
one bank from Singapore, for example, to
a syndicate allows PB orders to be placed
through it without investor identification.
Another possible route is for private
banks to place orders themselves and
then distribute bonds to individual clients,
since the SFC code only covers the primary
market and not secondary transactions.
The new code is intended to increase
transparency around proprietary orders,
and requires syndicates to give these the
lowest priority when deciding allocations.
However, private banks are expected to
argue that such orders are not proprietary
because they do not intend to hold the
securities.
possible”, adding that technical talks with
officials were continuing.
“We hope for a resolution of the
current situation that would allow for
our resumption of a dialogue on an IMF-
supported programme,” said an IMF
spokesman at a press briefing.
Since the pandemic started, hitting
tourist revenue, Sri Lanka has been unable
to issue bonds and has turned for finance to
neighbouring countries, principally India.
China and Japan are other major bilateral
creditors.
It is unclear how these debts will be
treated but it is likely some will claim to be
senior to private sector liabilities.

“Presumably it will be held on their
balance sheet, whether it’s for 30 seconds
or a day,” said a market source. “That’s
technically a proprietary order.”
The SFC wrote in May that “allocation to
proprietary orders could be prioritised over
investor clients’ orders based on the issuer
client’s allocation preference, provided
that the issuer client has made specific
instructions to this effect and its preference
is duly documented and recorded”.
In other words, if an issuer wants to
ensure PB clients are able to buy the
deal, it could request for orders from
bookrunners’ associated private banks to
be given priority. The private banks would
then distribute the paper to end clients in
secondary transactions that are not covered
by the SFC code, avoiding the need to
disclose their identities.
Club deals, offerings where pricing is
decided in advance, and private placements
are not covered by the code either.
“As long as investors are treated fairly
and issuers are happy, that seems to be
the SFC’s main concern,” said the market
source.
While private banks are protective of
client privacy, they are already subject to
similar disclosures in some other markets.
“This kind of requirement exists in some
other jurisdictions in Asia,” said a source at
a private bank in Singapore. “In places like
Korea we have to make similar declarations
or we are not allowed to buy certain
shares.”
In South Korea, shares in companies
deemed to have national importance are
subject to limits on foreign ownership,
ranging from 0%–49.99%, and all trades
placed by foreign investors must be
reported to the Financial Supervisory
Service.
DANIEL STANTON
In April the group of seven major
economies said they supported debt relief
for Sri Lanka. “The G7 stands ready to
support the Paris Club’s efforts, in line with
its principles, to address the need for a debt
treatment for Sri Lanka,” the group said in
a statement.
And US Treasury secretary Janet Yellen
said on Thursday that China should get
involved in the talks too. “Sri Lanka is
clearly unable to repay that debt, and it’s
my hope that China will be willing to work
with Sri Lanka to restructure the debt,” she
said in Indonesia at a G20 conference.
One sovereign restructuring adviser said
new creditors such as Russia could also
RBNZ tightens by another 50bp
The Reserve Bank of New Zealand
increased its official cash rate by an
expected 50bp to 2.5% on Wednesday, the
sixth successive rise, and signalled more
increases to come.
“It remains appropriate to continue
to tighten monetary conditions at pace
to maintain price stability and support
maximum sustainable employment. The
Committee is resolute in its commitment
to ensure consumer price inflation returns
to within the 1%–3% target range,” the
monetary policy committee said in a
statement.
The MPC cited ongoing supply
disruptions caused by Covid-19 and the
Russian invasion of Ukraine for generating
global price pressures, especially in food
and energy, but also noted the pace of
global economic growth is slowing.
Domestically, the MPC referred to a
broad range of indicators “highlighting
pervasive inflation pressures” with local
spending supported by high employment
levels, resilient household balance sheets,
continued fiscal support, strong terms
of trade and a reduction in Covid-related
restrictions.
“Labour and resource scarcity are also
contributing to upward price pressures
which are currently exacerbated by
seasonal illness, a resurgence in Covid-19
cases, and a net outflow of labour abroad,”
according to the statement.
The statement also endorsed the May
monetary policy projection which sees the
OCR rising throughout 2022 and peaking at
3.95% at the end of 2023, before returning
to “a lower, more neutral level”.
Headline CPI jumped 1.8% in the first
quarter of 2022 as the annual rate climbed
emerge, offering emergency support such
as oil, but that could complicate the shape
of any restructuring talks.
“The Chinese may be positioning
themselves to become problematic. And
there are lots of Russians in Colombo.
Geopolitically it is not quite clear which
way the country will lean,” he said. Much
will depend on the formation of a new
government.
The situation is similar to Lebanon,
which first said it would seek help from
the IMF in March 2020 after defaulting
on its bonds. Talks have barely got off the
ground more than two years later as the
country’s political situation remains fragile.
International Financing Review Asia July 16 2022 13
For daily news stories
visit www.ifre.com
from 5.9% to 6.9%, further outside the
reserve bank’s 1%–3% medium-term target
range.
Core inflation rose from 5.4% to 5.9%,
trimmed mean inflation climbed from 5.0%
to 6.1%, while weighted median inflation
edged up from 3.8% to 3.9%.
The unemployment rate of 3.2% is the
lowest since current records began in 1986
and Q1 2022 annual wage inflation at 3% is
the fastest in 13 years.
Wednesday’s increase follows 50bp rises
in April and May, and three 25bp increases
in October, November and February. New
Zealand was the fourth OECD country
to lift interest rates since the Covid-19
outbreak, after South Korea, Norway and
the Czech Republic.
New Zealand government bonds
responded positively to the latest MPC
meeting with two-year, five-year and 10-
year yields declining 5bp, 6bp and 4bp to
3.38%, 3.45% and 3.62%.
Capital Economics sees the OCR peaking
at 3.5% rather than the 4% the RBNZ has
indicated.
“Our view remains that the ongoing
housing downturn will weigh heavily
on residential investment and constrain
household spending, ultimately forcing the
Bank to stop hiking once the policy rate
reaches 3.5% by year-end,” the consultancy
said.
The RBC rates strategy team concurs.
“We continue to maintain our call for
a further 50bp hike in August, and two
subsequent 25bp hikes in October and
November, taking the OCR to a terminal
rate of 3.5% by the end of the year,” it
wrote.
JOHN WEAVERS
Sri Lanka’s talks could take time too, said
the adviser.
“The country is so far away from having
any [IMF] programme. People need to
take stock and appraise the situation
before meaningful discussions begin,” he
said. “Things could not have got off on a
worse footing, with potential intercreditor
disagreements as some claim different
treatment.”
Rothschild and law firm White & Case
are advising a group of bondholders
comprising 30 institutions including
BlackRock and Amundi as well as smaller
hedge funds.
CHRISTOPHER SPINK
 People
& Markets
IN BRIEF
People’s Bank of China
Push for Chinese ratings even offshore
The People’s Bank of China is encouraging
Chinese issuers to use at least one Chinese
rating agency for offshore bond issues,
according to a press release from Lianhe
Ratings, a Chinese rating agency.
In a document called Action Plan for Promoting
the High-quality Development of Beijing’s Credit
Information System, the central bank said it
invites local government financing vehicles,
financial institutions and corporate bond issuers
to use Chinese rating agencies when issuing
offshore bonds, and use at least one local rating
agency when tapping the Chinese dollar bond
market.
It also recommends that issuers seek ratings
from at least two rating agencies to prevent
information asymmetry.
The PBoC said the move is to raise the influence
of Chinese agencies in the international capital
markets.
Temasek Holdings
Portfolio sees strong growth
State-owned TEMASEK HOLDINGS’ portfolio value
rose to S$403bn (US$286bn) as of March 31, up
from S$381bn a year earlier.
The one-year total shareholder return, which
includes all dividends distributed to the sole
shareholder, the Singapore ministry of finance,
net of new investment from the MoF, was 5.81%.
During the year, Temasek invested S$61bn and
divested S$37bn.
Asia accounted for 63% of the portfolio, with
Singapore (27%) and China (22%) the largest
countries by exposure.
Underlying exposure to developed economies,
which includes Singapore, North America,
Europe, Australia and New Zealand, increased
WHO’S MOVING WHERE...
„ BOCOM INTERNATIONAL HOLDINGS has appointed
Zhu Chen as chief executive officer and executive
director of the company effective July 11,
according to a Hong Kong stock exchange filing.
Zhu was general manager of Bank of
Communications’ international banking
department from July 2017 and has been at
the bank since 1993. Her previous roles include
general manager of BoCom’s Taipei branch.
Tan Yueheng was previously chairman and
CEO of BoCom International. He will remain
chairman and executive director.
„ Ross Bennett has been promoted to head of
14 International Financing Review Asia July 16 2022
to 65%, from 60% a year earlier.
Financial services made up 23% of the portfolio,
and transportation and industrials 22%.
Telecommunications, media and technology
accounted for 18%, down from 21% a year
earlier.
Unlisted assets comprised 52% of the portfolio
and were worth S$210bn, around four times
the amount Temasek held in unlisted assets a
decade ago.
These include investments in unlisted
Singaporean companies (36%), other private
companies including early stage companies
(26%), its asset management businesses (20%),
and private equity and credit funds (18%). Early
stage companies made up less than 10% of the
unlisted portfolio.
Temasek said unlisted assets delivered annual
returns of over 10% over the past 10 years.
The investment company has a target to reduce
the net carbon emissions of its portfolio to half
the 2010 levels by 2030, and achieve net zero
carbon emissions by 2050. In the past year it
invested in start-ups like Form Energy, which
is developing a low-cost battery, and Fortera,
which aims to produce low-carbon cement.
AIMA
Trade body urges HK to ease travel
Hong Kong needs to allow financial sector
employees to travel freely to retain its global
investment and banking hub status, an industry
report said, as the city continues to maintain
some of the strictest coronavirus regulations in
the world.
“It is critical that a delicate balance is struck giving
proper recognition to Hong Kong’s stature as an
international financial centre and broader local
public health considerations,” said the report
from the Alternative Investment Management
Association and PwC released on Tuesday.
structured finance for Asia Pacific at NORDLB
replacing Niels Jakeman, who has relocated to
London to become head of structured finance
origination for energy in Europe.
Both started in their new roles on July 1,
according to an announcement from the
German bank.
Singapore-based Bennett has been with NordLB
for four years, focused predominantly on the
Australian renewable energy market.
Jakeman joined NordLB in 2015 in Singapore
and was responsible for the origination and
financing of energy and infrastructure projects in
Asia-Pacific.
Quarantine rules and flight bans have meant
business travel to Hong Kong has flatlined
and global bank chiefs have mostly avoided
travelling to the city since 2020, even while
visiting rival regional financial hub Singapore in
recent months.
The Chinese special administrative region
is the largest hedge fund centre in Asia,
the report said, with more than half of the
major funds that have at least US$1bn under
management in the region located in Hong
Kong.
Phillip Meyer, AIMA Hong Kong executive
committee chair, urged policymakers to listen to
the message “coming from every corner of every
business sector.”
Travel restrictions and border closures have led
to an exodus of residents during the last two
years, with the financial services sector facing a
‘brain drain’ of talent.
A net 140,000 people have left since the
start of this year, official data shows. It is
unclear how many have left temporarily or
permanently.
“The worst case is if in 12 months we are where
we are today, then I think there’s some real
challenges. Some business and people who
have continued to be committed to Hong Kong
may need to move,” Meyer said.
Hong Kong has reported more than 1.2 million
coronavirus infections and around 9,400
deaths.
While the city has escaped the death tolls
of other major centres, Hong Kong is one of
only a handful of cities left to still implement
quarantine with inbound travellers required to
spend seven days in a designated hotel at their
own cost.
A rule that banned individual flights for
bringing in passengers infected with the Covid-
19 virus was relaxed last week after the city’s
government said the ban caused “unnecessary
trouble” and inconvenience to residents.
(Reuters)
He will be focused on growing the bank’s 17GW
renewables portfolio throughout Europe.
„ ACADIAN ASSET MANAGEMENT has hired
Scott Richardson as a director to lead a new
systematic credit capability.
Richardson will build out a team of portfolio
managers, researchers, traders and support
personnel with plans to seed the first strategies
next year, Acadian said in a press release on
July 13.
Systematic credit strategies employ data-driven
insights backed by risk controls to deliver
differentiated portfolio outcomes.
Acadian’s initiative will initially focus on
corporate credit-based strategies including
 For daily news stories
visit www.ifre.com

high-yield and investment grade corporates,
and credit long-short.
Richardson has over 15 years of experience
in leading both systematic equity and credit
investing.
He previously worked as a researcher and
portfolio manager at ARQ Capital Management
with a focus on credit and fixed income markets
and has held senior positions at BlackRock
(Barclays Global Investors), including head of
Europe equity research and head of global credit
research. He is also a professor at the London
Business School.
Acadian cited changing bond market dynamics,
including increases in electronic bond trading
and data availability, alignment with their core
capabilities, and investor demand as the primary
drivers behind its entry into systematic credit.
“We believe incremental investment in our
research and resources towards credit will
provide differentiated fixed income strategies for
our clients,’’ said Ross Dowd, CEO of Acadian.
“We continue to see investor demand for
systematic strategies offering consistent returns
paired with clarity around return drivers.”
“We believe these fixed income strategies
most closely resemble the equity strategies we
manage today and will benefit from our existing
expertise in data analysis, signal construction,
and trading,” said chief investment officer
Brendan Bradley.
Boston-headquartered Acadian had
US$109.4bn in assets under management
globally as of March 31. It manages equity and
multi-asset portfolios on behalf of pension
funds, endowments, governments, foundations
and other institutional investors. It has affiliates
in London, Sydney and Singapore.
„ IMI INTESA SANPAOLO has appointed Rehan
Ahmed as head of debt capital markets for the
Middle East, Africa, Asia and Turkey.
Ahmed’s LinkedIn profile showed he joined the
Italian bank in June. He is based in Dubai and
had previously spent over five years at Emirates
NBD, where he headed the sustainable solutions
business across DCM, equity capital markets,
corporate finance and syndicated and structured
finance businesses. Ahmed has also worked
before at HSBC and BNP Paribas.
Ahmed is reporting to Hedi El Karoui, general
manager and senior executive officer, Intesa
Sanpaolo Dubai branch, and Nerijus Damanskas,
global head of emerging markets DCM (London).
„ Chen Gongyan has retired from the role
of chairman at CHINA GALAXY SECURITIES and is
replaced by Chen Liang, who was previously
president and vice chairman.
China Galaxy has hired Wang Sheng as president
and vice chairman.
Wang joins from CICC, where he was head of the
investment banking department. He joined the
bank in 2002, working on a range of capital
markets transactions and helping to reform
companies in various industries.
Wang Shuguang, head of the growth enterprise
investment banking division at CICC and co-
head of its private equity business, has been
named as the bank’s new head of investment
banking, according to an internal email seen by
IFR. He joined the bank in 1998, and in addition
to establishing the growth enterprise investment
banking division helped develop the bank’s M&A
and investment businesses.

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Australia 17 China 20 Hong Kong 24 India 27 Indonesia 29 Japan 30 Macau 31 Malaysia 31
New Zealand 32 Philippines 32 Singapore 33 South Korea 33 Taiwan 34 Thailand 35 Vietnam 36
AUSTRALIA
DEBT CAPITAL MARKETS
›GERMAN AGENCIES RAISE A$200M
RENTENBANK (Aaa/AAA/AAA), Germany’s
government-guaranteed agency for
agribusiness, tapped its 3.25% April 2028
Kangaroo bond for AS$100m (US$68m) on
Thursday, bringing the total outstanding
size to A$1.105bn.
The reopening, via sole lead manager
SAFA sees fixed-rate benefits
„ Bonds Scarcity demand provides support following FRN flurry  F notes are 250bp area, 300bp area, 375bp
Following two jumbo floating-rate note issues
from Treasury Corporation of Victoria and New
South Wales Treasury Corp last month, SOUTH
AUSTRALIAN GOVERNMENT FINANCING AUTHORITY,
rated Aa1/AA+ (Moody’s/S&P), targeted a
broader investor base for a A$1bn (US$674m)
tap of its 2% May 23 2036 benchmark bond.
The reopening on Tuesday, which doubled
the outstanding amount to A$2bn, priced
at 74.992 for a yield of 4.435%, at the wide
end of EFP (10-year futures) plus 94bp–97bp
guidance.
ANZ, Citigroup and Westpac were joint
lead managers alongside Barrenjoey, which
won its third SAFA mandate since joining the
state funding arm’s now 14-strong domestic
bond dealer panel in December.
SAFA raised A$1bn from the bond’s initial
syndicated sale on July 16 last year that priced
to yield 2.235% and came 88bp wide of EFP.
Bank balance sheets, which have a clear
preference for floating-rate notes as they
best match their assets and liabilities, were
allotted a whopping 97% of TCorp’s A$4bn
September 2029 and August 2031 FRNs on
June 27.
In contrast, balance sheets bought around
one-third of the SAFA fixed-rate addition,
while asset managers and insurance
companies also took about one-third,
with official institutions and trading desks
allocated 13% and 17%.
Approximately 90% was placed with
Australian investors and 10% offshore.
Nevertheless, balance sheets still picked up
significantly more than their 9% share of the
COUNTRY REPORT
RBC Capital Markets, priced at 95.943 to yield
4.05%, 39bp wide of asset swaps.
On July 8, fellow German agency KFW (Aaa/
AAA/AAA) added A$100m to its now A$400m
2% February 15 2027 line via TD Securities.
The increase priced at 75.1 for a yield of
3.92%, 75.1bp over ACGBs,
STRUCTURED FINANCE
›PEPPER RMBS HALVED AND DELAYED
Non-bank lender PEPPER MONEY has halved the
indicative size of its non-conforming RMBS
offering, PEPPER PRS33, to A$500m (US$340m)
bond’s original A$1bn print, thanks, at least in
part, to the Australian Prudential Regulatory
Authority’s decision to phase out banks’
reliance on the Reserve Bank of Australia’s
committed liquidity facility by the end of 2022.
The removal of the CLF leaves semi-
government paper as the highest yielding of
the few remaining eligible assets (sovereign
bonds, agency bonds and cash held at the
RBA) that banks can hold to withstand 30
days of severe liquidity stress in order to meet
Basel III rules.
FUNDING REQUIREMENT
The A$1bn increase takes out a decent chunk
of SAFA’s total term funding requirement for
fiscal year 2022–23 (July–June) of A$6.6bn
that was announced on June 2.
SAFA also plans to issue a new May 2038
fixed-rate bond and a new June 2027 Aonia-
linked floating-rate note.
The state funding arm said it would
continue to tap existing even calendar year
benchmarks via syndicated sales and public
tenders, with the aim of increasing these to
approximately A$4bn, up from the previous
A$3.5bn target.
It also intends to extend its maturity debt
profile out to 30 years in even calendar year
maturities, subject to market conditions,
investor demand and client borrowing
requirements.
For odd calendar year bonds, SAFA said it
will issue up to A$3bn in new bonds and will
not tap existing lines.
JOHN WEAVERS
International Financing Review Asia July 16 2022 17
and dropped a senior US dollar tranche
which was part of the initially indicated
A$1bn-equivalent transaction.
NAB is arranger and joint lead manager
with CBA, Macquarie, Standard Chartered and
Westpac for the securitisation which is now
expected to launch and price this week rather
than last week as previously indicated.
Guidance is unchanged for the now
smaller Australian dollar tranches and
remains in line with the non-conforming
RedZed Trust Series 2022-1 RMBS issued on
July 8.
For the A$140m of Class A1-s and A$260m
of Class A1-a notes, with 0.6 and 3.0-year
weighted average lives, price talk is one-month
BBSW plus 115bp area and 175bp area.
Indicative clearing margins for the
A$49.5m of Class A2, A$24.5m of Class
B, A$9.5m of Class C, A$6m of Class B,
A$3.75m of Class E and A$2.75m of Class
area, 420bp area, 620bp area ad 750bp area.
The Class E and F notes are no longer
available.
The revised transaction is completed by
A$2m of G1 notes and A$2m of retained G2
notes.
Respective credit support for the Class
A1 to F notes is 20%, 10.1%, 5.2%, 3.3%, 2.1%,
1.35% and 0.8%.
Pepper issued the A$500m single-
currency Pepper PRS32 non-conforming
RMBS on March 24 when the Class A1-s,
A1-AU and A2 notes priced 65bp, 130bp and
190bp wide of one-month BBSW.
SYNDICATED LOANS
›ANGLO PACIFIC ADDS ACCORDION
UK-based mining royalties company ANGLO
PACIFIC GROUP has agreed with its lenders to
maintain the size of an existing loan at
US$150m without the previously scheduled
US$25m step-down in August.
A US$50m accordion feature will be
added to the facility for future acquisitions,
the company said in an exchange filing on
Tuesday.
Anglo Pacific has agreed to acquire a
portfolio of royalties from South32’s copper
and nickel projects for US$185m with a
further contingent consideration of up to
US$15m.
The initial consideration comprises a
US$47.6m cash payment, along with a
US$82.4m share issuance on completion
to South32. As a result, Anglo Pacific will
become a 16.9% shareholder in the enlarged
business.
The company will make six quarterly
instalments over the next 18 months, which
will be largely self-financed via cashflow
from the group’s current asset portfolio.
The portfolio being acquired include
royalties over the West Musgrave copper
and nickel project in Australia, Santo
Domingo copper project in Chile, Nifty
copper mine in Western Australia and
Carlota copper mine in the US.
The acquisition is expected to close by
the end of the month.
Canadian Imperial Bank of Commerce’s
London branch acted as financial adviser to
Anglo Pacific for the acquisition.
In February last year, Anglo Pacific
obtained a US$180m three-year senior
secured revolving credit facility to back its
acquisition of a cobalt revenue stream. The
revolver carried a one-year extension option
and was slated to step down to US$150m.
The revolver pays an interest margin
ranging between 275bp and 500bp over
Libor depending on the leverage.
›REX DRAWS DOWN CONVERTIBLE NOTES
(Rex) is drawing
REGIONAL EXPRESS HOLDINGS
down an existing convertible note of up to
A$150m (US$101m) from PAG Asia Capital
Regulator approves Aurizon’s One Rail buy
„ Loans Authorities greenlight the purchase on condition of the demerger of East Coast Rail
The Australian competition regulator
has approved AURIZON HOLDINGS’ proposed
acquisition of One Rail Australia, clearing the
way for the transaction that was announced
last October to proceed.
After raising preliminary concerns in June,
the Australian Competition and Consumer
Commission has accepted Aurizon’s
undertaking to divest One Rail Australia’s
east coast rail haulage business EAST COAST
RAIL.
Aurizon will start a dual track process for
the trade sale and demerger of East Coal Rail
immediately after the completion of the One
Rail Australia acquisition, which is expected
by the end of July.
“Without the divestment of One Rail’s
east coast business, the ACCC considered
that the proposed acquisition would reduce
the number of main competitors in the
supply of coal haulage in New South Wales
and Queensland from three to two, likely
resulting in higher prices or decreased service
levels,” ACCC chair Gina Cass-Gottlieb said.
18 International Financing Review Asia July 16 2022
to partially fund its proposed acquisition
of National Jet Express, a regional services
arm of Cobham Aviation Services Australia.
Rex has agreed to buy 100% of National Jet
Express, a provider of ‘fly-in, fly-out’ services
in Western Australia and South Australia, for
about A$48m. The target also operates freight
services from Sydney to Adelaide, Brisbane,
Melbourne and the Gold Coast as well as
charter services in Papua New Guinea.
The airline will draw down around
A$15m of the convertible notes from
PAG, while its joint venture partners,
including the company chairman, will also
be providing about half of the acquisition
consideration from private funds, Rex said
in an ASX filing on July 15.
The private debt funding from the JV
partners is convertible into new shares of
National Jet Express and will go towards
reducing Rex’s debt burden. Ultimately, Rex
and its JV partners will each own 50% of
National Jet Express.
The acquisition is subject to approvals
from regulators, including from Australia’s
Foreign Investment Review Board.
The convertible notes from PAG that Rex
is partially drawing down were issued in
2020 to support the company’s domestic
jet operations. The senior secured notes are
convertible into ordinary shares of Rex at
A$1.50 per share and PAG could potentially
“The divesture ensures that there will remain
three main suppliers of coal haulage in New
South Wales and Queensland.
“We are also satisfied that the divestment
of One Rail’s east coast business would
preserve it as a potential competitor to
Aurizon for the supply of non-coal bulk rail
haulage in the future, and Aurizon would
continue to be constrained by a number of
existing bulk rail haulage competitors,” she
said.
One Rail Australia’s business comprises
bulk rail haulage and general freight assets
in South Australia and the Northern Territory,
the 2,200km Tarcoola-to-Darwin railway line,
and the East Coast Rail haulage business in
New South Wales and Queensland.
Aurizon will integrate the One Rail
Australia bulk rail haulage and general
freight assets, and the Tarcoola-to-Darwin
railway line into its existing bulk business.
It obtained two loans totalling A$1.97bn
for the acquisition of One Rail Australia and
its East Coast Rail business.
hold approximately 48% of Rex’s shares if
fully converted.
›OCP ASIA DEBT FOR DISABILITY HOUSING
Private credit manager OCP Asia has
injected A$200m into specialist disability
accommodation in Australia.
Proceeds of the debt will fund the
acquisition and development of a
portfolio of 40 sites for high physical
support apartments over the next four
years through a partnership with SOCIAL
IMPACT FUNDS MANAGEMENT and disability
accommodation provider NDISP.
OCP Asia will be given the option to
recapitalise the portfolio into SIFM’s
Specialist Disability Accommodation Real
Estate Investment Trust, which has a 2026
target to list on the Australian Securities
Exchange, the Australian ethical and
impact fund said July 11.
The REIT plans to make over A$1.1bn of
investments over the next four years. SIFM
had agreements to roll up over A$500m of
SDA properties across Australian states and
territory as at December 31.
›MONASH UNIVERSITY OBTAINS DEBUT SLL
has obtained a maiden
MONASH UNIVERSITY
A$105m five-year sustainability-linked loan,
Aurizon’s A$1.45bn loan is split into a
A$400m five-year term loan (Facility A1), a
A$400m three-year revolver (Facility A2) and
a A$650m two-year bridge loan (Facility B),
and offers interest margins of 130bp–160bp
over BBSY.
East Coast Rail’s A$515m borrowing
comprises a A$250m two-year bridge loan
(Facility A), a A$250m five-year term loan
(Facility B) and a A$15m one-year working
capital facility (Facility C). The margin for
facility B is 350bp over BBSY.
When Aurizon announced its acquisition
of One Rail Australia, formerly known
as Genesee and Wyoming Australia,
from Macquarie Asset Management last
October, it said the deal was expected to be
completed by April this year.
Aurizon units Aurizon Operations and
Aurizon Network are rated Baa1/BBB+
(Moody’s/S&P).
In October, Aurizon said it was targeting an
investment-grade rating for East Coast Rail.
MARIKO ISHIKAWA

following its recent debut in the Australian
medium-term notes market.
ANZ is the sole sustainability coordinator,
while Westpac Banking Corp is a joint lender.
The targets for the SLL focus on a reduction
in scope 1 and 2 emissions of 72% during
the term of the loan, a reduction in general
and construction and demolition waste
going to landfill, the number of students and
staff who have completed Monash’s First
Nations Cultural Awareness training and the
number of students who complete the Global
Immersion Guarantee programme.
Monash has a commitment to net zero
emissions by 2030.
The SLL is an addition to its climate bond
programme, which was established in 2016
and has helped fund renewable energy and
green building projects.
ANZ worked with Monash to update
its green bond framework, which has
been renamed the Monash University
Sustainable Finance Framework and now
includes SLLs as well as bonds.
In March, Monash University, rated Aa1
(Moody’s), raised A$175m from a seven-year
senior unsecured bond offering via joint
managers ANZ and Westpac. The 4.05%
April 6 2029s priced at 99.946 to yield
4.059%, at asset swaps plus 95bp.
›INSITEC OBTAINS PRIVATE DEBT FOR M&A
IT systems integrator INSITEC has obtained
a A$26.5m loan from Muzinich & Co for its
acquisition of a stake in tech recruiter The
Network.
OMERS dials for TPG Telecom buy
„ Loans Infrastructure manager is tapping market to buy cell towers with 20-year usage contract
Canada’s OMERS INFRASTRUCTURE MANAGEMENT
is seeking a A$570m (US$383m) five-year
loan to back its proposed acquisition of TPG
Telecom’s mobile tower assets in Australia.
National Australia Bank and Royal Bank
of Canada are the mandated lead arrangers
and bookrunners for the loan, commitments
for which were due in the week of July 4.
On May 9, OMERS Infrastructure announced
it has agreed to acquire 100% of TPG Telecom’s
passive mobile tower and rooftop infrastructure
for an enterprise value of A$950m.
The assets, consisting of over 1,230 sites
that are concentrated in metro locations
across Australia, will become the largest
independent tower company in Australia.
Under the terms of the acquisition, TPG
has entered into 20-year contract to use the
tower assets with options to extend. TPG has
The loan also refinances Insitec’s existing
borrowings with the Commonwealth Bank
of Australia and funds additional working
capital.
The financing marks Muzinich’s first
private debt transaction in Australia,
according to a July 6 announcement from
law firm Hogan Lovells, which advised the
credit manager.
VCF Capital acted as financial adviser to
Insitec on the acquisition of a 65% interest
in The Network and the refinancing.
Muzinich Asia Pacific Private Debt Fund I
is focused on private debt services targeted
at lower middle-market companies with an
Ebitda range of US$5m–$50m.
In June last year, DBS Group said it would
invest up to US$200m in Muzinich’s Asia
Pacific private debt fund, or 40% of the total
fund size, whichever is lower.
Insitec provides a range of services,
as well as research and development-led
products, primarily to the defence industry.
›PACT-CLEANAWAY JV FUNDS RECYCLING
A joint venture between Pact Group
Holdings and Cleanaway Waste
Management has obtained A$23.5m in
funding to purchase sorting, washing,
melting and forming equipment for its
mixed plastics recycling plant in Australia’s
Victoria state.
DLL, a wholly owned vendor finance
subsidiary of Rabobank, is providing the
asset financing to CIRCULAR PLASTICS AUSTRALIA,
it said on July 13.
also committed to building additional towers
to further expand the network.
The closing of the transaction is expected
in the third quarter, subject to customary
conditions including approval from
Australia’s Foreign Investment Review Board.
This is OMERS Infrastructure’s first 100%-
owned investment in Australia and its first
digital infrastructure investment in Asia Pacific.
RBC Capital Markets, Baker McKenzie,
PricewaterCoopers, Altman Solon, Grex
Consulting and Alvarez & Marshal were the
advisers to OMERS Infrastructure.
TPG Telecom said the net sales proceeds
of the tower assets will be used to pay down
loans as it looks to mitigate the impact of
rising interest rates.
As at December 31, TPG Telecom had
net debt of A$4.088bn, according to an
International Financing Review Asia July 16 2022 19
COUNTRY REPORT AUSTRALIA
The A$38m plant in Laverton, due to be
completed early next year, will recycle more
than 20,000 tonnes of plastic milk bottles
and food tubs collected from household
recycling bins in Victoria every year.
Cleanaway will provide the plastic waste
through its collection and sorting network,
while Pact Group will provide technical
knowledge and operate the plant. Pact
Group will use the recycled resin produced
to manufacture food packaging.
The Victorian and federal governments
are supporting the project.
In July last year, Commonwealth Bank of
Australia and Clean Energy Finance Corp
provided A$33m in debt to the JV to build
a polyethylene terephthalate recycling
facility in New South Wales.
›LILYVALE SOLAR FARM SET FOR REFI
Fotowatio Renewable Ventures has
obtained a green loan of an undisclosed
amount to refinance its LILYVALE SOLAR FARM in
Australia’s Queensland state.
Natixis acted as the mandated lead
arranger, bookrunner and underwriter,
structuring lender, hedging and letter of
credit provider as well as green coordinator,
according to an announcement from the
French bank on July 13.
Export Development Canada and NordLB
were the MLAs, while the latter was also a
hedge provider.
Lilyvale has a A$179.4m five-year loan
maturing in September, according to
Refinitiv LPC data.
investor presentation.
In June 2021, TPG Telecom completed the
amendment and extension of the A$4.75bn
loan with 15 banks.
The loan comprised a A$2.07bn three-year
term loan (tranche A), a A$1.72bn five-year
term loan (tranche B), and a A$960m five-
year revolver (tranche C), offering interest
margins of 125bp over BBSY for tranche A
and 145bp over BBSY for tranches B and C,
based on leverage of 2.5x–3.0x.
OMERS Infrastructure manages investments
globally in infrastructure on behalf of OMERS,
the pension plan for municipal employees in
Ontario province. It currently has approximately
C$32bn (US$24.6bn) in assets under
management on behalf of OMERS and third-
party investors.
MARIKO ISHIKAWA
 ANZ, MUFG and Sumitomo Mitsui
Banking Corp were the MLAs on the club
loan.
Located in the Queensland Central
Highlands region, the 126MW solar farm
is one of the largest photovoltaic plants in
Australia.
Lilyvale is connected to the national
power grid, generating enough power for
a population equivalent to 44,000 homes,
while avoiding emissions of 218,900 tons of
carbon dioxide per year.
EQUITY CAPITAL MARKETS
›CARSALES.COM WRAPS UP RIGHTS OFFER
Online automotive classifieds business
CARSALES.COM has raised a total of A$1.2bn
(US$807.3m) from a fully underwritten
rights offer, after it completed a retail
entitlement offer.
The company raised A$842m from
institutional investors in the 1-for-4.16
pro rata accelerated non-renounceable
entitlement offer. The fully underwritten
offer was sold at A$17.75 per share or a
14.5% discount to the company’s close of
A$20.76 on June 24.
It had targeted A$365m in the retail
entitlement offer of 20.56m shares, but
raised just A$183m after only 10.3m
shares were subscribed to by eligible retail
shareholders. The leftover shares will be
taken up by the sub-underwriters of the
retail offer.
Morgan Stanley, Goldman Sachs and UBS are
the underwriters of the institutional and
retail entitlement offers.
Proceeds will be used to buy the
remaining 51% of US online vehicle
marketplace Trader Interactive for
US$809m from private equity company
Eurazeo and Goldman Sachs Asset
Management.
CHINA
DEBT CAPITAL MARKETS
›FITCH DOWNGRADES CCRE TO B
Fitch has downgraded CENTRAL CHINA REAL
ESTATE to B with negative watch from
B+ ahead of an August 8 maturity on a
US$500m 6.875% bond.
The downgrade reflects the Chinese
property developer’s tight liquidity and
weak contracted sales in the first half of
this year.
20 International Financing Review Asia July 16 2022
Fitch said that the company is likely
to repay the bonds using proceeds from
asset disposals and cash from operations.
However, uncertainty over the completion
of a proposed equity transaction in time
motivates the negative watch, as the
proceeds are intended to partly fund the
bond redemption.
CCRE had cash of Rmb5.9bn (US$877.3m)
as of end-2021, which looked enough to
cover the maturing US dollar bond and
Rmb1.2bn of trust loans also maturing
this year. However, the company has been
reporting falling contracted sales this year,
which Fitch expects to fall by 30% to around
Rmb42bn this year.
CCRE is selling a 29% stake for HK$688m
(US$87.6m) to the Henan government via
Henan Tongsheng Zhiye. The latter will also
subscribe for HK$708m convertible bonds
due 2024 with a coupon of 5% and a yield to
maturity of 9%.
The sale would concretise support from
the Henan government and improve
CCRE’s liquidity and capital structure, and
thereby access to funding channels.
Lucror Analytics said the downgrade
was fair as it implied that Fitch does not
see immediate liquidity constraints for
the credit, which should be a positive for
CCRE’s outstanding US dollar bonds. The
2022s have fallen sharply from over 80 to
around 54 currently, due mainly to the
delayed stake sale, originally due to close
on July 1, and a lack of clarity on whether
the company’s cash reserves can cover the
full redemption of the bond.
›CIFI BUYS BACK BONDS
has repurchased US$5m,
CIFI HOLDINGS (GROUP)
or 1.67%, of its US$300m 5.5% 2023 bonds.
The 5.5% bonds will mature on January
23 2023, the latest maturity that the
Chinese property developer has. The bonds
were trading at 73.75 on July 11.
In addition, the company’s executives
bought back Rmb9.54m of onshore bonds
from the secondary market between June
24 and July 7. Chen Dongbiao, executive
director and executive president, and Yang
Xin, executive director and chief financial
officer, made the repurchases.
›FITCH DOWNGRADES TIMES CHINA
Fitch has downgraded TIMES CHINA HOLDINGS’
issuer and bond ratings to CCC+ from B+.
The rating agency said the downgrade
reflected the property developer’s
tightening liquidity. It said that Times
China’s funding access may not improve by
the first half of 2023, making it likely that
it will need to use internal cash and cash
generation to repay debt maturing between
this year and the first half of next year. The
company’s capacity to meet its repayment
obligations hinges on a sales recovery and
asset disposals, said Fitch.
Times China has one onshore bond
due this year, a Rmb1.1bn 5.5% note, and
a US$300m 6.6% bond, a US$500m 6.75%
bond and a Rmb1.9bn 7.5% note maturing
in 2023.
Moody’s downgraded Times China on
July 7. It lowered the company’s issuer
rating to Caa1 from B2 and the bond rating
to Caa2 from B3.
The two dollar bonds were trading
between 16 and 18 on Tuesday.
›FUJIAN ZHANGLONG PRINTS GREEN NOTE
FUJIAN ZHANGLONG GROUP has priced a US$500m
4.8% two-year 11-month bond at 99.601 to
yield 4.95%.
The senior green note will be used to
finance or refinance eligible projects in
accordance with the company’s green
finance framework.
The Reg S bond will be rated BBB– (Fitch),
in line with the issuer.
Guotai Junan International and Industrial
Bank Hong Kong branch were the joint global
coordinators, as well as joint bookrunners
and lead managers with CEB International,
China International Capital Corp, China
Industrial Securities International, CLSA, CMBC
Capital, CMB International, CNCB Capital, DBS
Bank, Huatai International, Hua Xia Bank Hong
Kong branch, Luso Bank and Shanghai Pudong
Development Bank Hong Kong branch.
›HUIJING TO SWAP 2022 NOTE
Property developer HUIJING HOLDINGS, rated
B+ by Lianhe, has received US$107.6m, or
77.97%, of the principal of its US$138m
12.5% 2022 note tendered under its
exchange offer.
The company agreed to accept all
the bonds tendered. The amount of the
principal of the bonds tendered was only
slightly over the minimum acceptance
amount, which was US$107.4m, or 77.8%.
Huijing will issue US$107.6m in principal
amount of a new 12.5% 364-day bond
and pay US$6.6m in cash for accrued and
unpaid interest to swap the old bonds. The
new note, to be listed on the Singapore
stock exchange, is expected to be settled on
July 19.
CMB International Capital was the sole
dealer adviser, while DF King was the
information and exchange agent.
›POWERLONG EXCHANGES 2022 NOTES
POWERLONG REAL ESTATE HOLDINGS,
rated Caa2/B–
(Moody’s/S&P), has received tenders for

over 87% of its US$200m 4% July 2022 and
US$300m 7.125% November 2022 notes
under an exchange offer.
For the July notes, US$178.7m, or 89.35%,
of the principal amount, were tendered.
Bondholders who agreed to the exchange
offer will receive for each US$1,000 of
principal US$950 in principal of new 4%
July 2023 bonds, a US$10 cash incentive
and US$50 in principal repayment. The new
bonds will have a size of US$169.8m.
For the November bonds, the company
received US$262.7m, representing 87.6% of
the principal amount. Bondholders will be
given an equivalent amount of new January
2024 notes, plus a US$10 cash incentive.
The company will redeem 5% of the
principal amount of the new January bonds
by October 18 2022. The 7.125% January
2024 notes will have a size of US$262.7m.
Powerlong waived the minimum 90%
acceptance for the exchange. Both new
bonds will be settled on July 15.
The company also obtained bondholders’
approval to amend the event of default
for its outstanding US$419.6m 6.95% 2023,
US$500m 6.25% 2024, US$535m 5.95% 2025
and US$200m 4.9% 2026 bonds. It will pay
a US$2.50 consent fee per US$1,000 in
principal amount on July 15.
Evergrande unit defaults onshore
„ Bonds Property developer fails to gain consent for second bond extension
CHINA EVERGRANDE GROUP’s main onshore
unit, HENGDA REAL ESTATE GROUP, has failed to
gain bondholder consent to postpone the
repayment of a Rmb4.5bn (US$672m) 6.98%
onshore bond.
The bond has a maturity of January 8
2023 and carries a put option which could
originally be exercised on January 8 this year,
and that bondholders had agreed in January
to postpone to July 8.
This time, Hengda proposed to push back
the put date further to the maturity date. It
also asked for bondholder consent to skip the
interest payment on July 8.
The company said in a filing to the
Shenzhen Stock Exchange that 90.56% of the
investors voted against the extension, and only
9.4% voted in favour. Majority consent was
needed to pass the amendments.
Hengda said it will actively hold
discussions with bondholders to reach an
acceptable solution as soon as possible.
“I think the rejection may suggest that
onshore bondholders are tired of the
repeated extensions and are now pushing
for restructuring instead,” said Leonard Law,
The exchange offer and consent
solicitation was launched on July 4 and
expired on Wednesday.
Haitong International Securities was the
solicitation agent. Morrow Sodali was the
information, exchange and tabulation
agent.
›RONSHINE MISSES INTEREST PAYMENTS
RONSHINE CHINA HOLDINGShas missed interest
payments on its US$324m 8.1% bond due
June 2023 and US$410m 7.35% bond due
December 2023.
The property developer was supposed to
pay US$12.8m in interest for the June bond
on June 9, and US$15.1m for the December
note on June 15. There was a 30-day grace
period for both bonds.
Ronshine said in a filing to the Hong
Kong stock exchange on July 10 that it
had not made the payments and cannot
guarantee that it will be able to meet the
obligation within the grace period. It said
that it had not received any notice from
the bondholders to accelerate repayment of
either bond.
The company said that it plans to hire
external advisers to find solutions with
overseas creditors.
a senior credit analyst at Lucror Analytics.
“Going forward, we may see more onshore
instances of onshore creditors rejecting
extensions for other stressed developers.
That said, the developers and authorities
would have to try to limit cross-default
so that projects can continue to operate
normally.”
In addition to the bond, Hengda also
sought in April to extend a coupon payment
on a Rmb8.2bn 7% 2026 note by six months
from April 27 to October 27, for which it
gained consent.
Although the high percentage of investors
who were against Hengda’s extension
proposal surprised some market participants,
Christy Lee, a senior fixed income portfolio
manager at AXA Investment Managers,
believes the onshore default was not
surprising to the offshore market. “The
entire sector is already all trading at deeply
distressed levels, reflecting the low expected
recovery by investors,” she said.
Evergrande has been struggling since it
defaulted at the end of 2021, which triggered
a domino effect in China’s broader property
International Financing Review Asia July 16 2022 21
COUNTRY REPORT CHINA
The two bonds were trading at around 11
on July 10.
Moody’s downgraded Ronshine’s issuer
rating to Ca from Caa1, and bonds rating
to C from Caa2, following the company’s
announcement. The rating agency said
the downgrade reflected the expectation
of weak recovery prospects for Ronshine’s
bondholders after its default on interest
payments.
S&P and Fitch do not rate Ronshine.
›SUNKWAN EXCHANGES 2022 BOND
SUNKWAN PROPERTIES GROUP has received
US$209.8m or 99.9% of the principal of a
US$210m 12.25% 2022 bond tendered under
an exchange offer.
Bondholders who agreed to the exchange
will receive like for like in principal
amount of new 12.25% 364-day notes, plus
accrued and unpaid interest paid in the
form of principal.
Sunkwan will issue US$222.4m of the
new bond on July 18.
In addition, the company also received
consent to amend the event of default
provision in its US$160.2m 13.5% 2023 note
to carve out the cross-default provision.
Sunkwan said that it may not make a
sector. Last month, investment holding
firm Top Shine Global filed a winding-up
petition in Hong Kong against Evergrande
for a financial obligation of HK$862.5m
(US$110m).
Also last month, the property developer
said that there was an active investigation
into the pledge guarantee of subsidiary
Evergrande Property Services. The unit
announced in March that banks had seized
Rmb13.4bn after it provided guarantees for
third-party debt.
Lucror’s Law also pointed out the onshore
default may result in a delay of Evergrande’s
offshore debt restructuring plan, which is
expected to be launched by the end of July.
However, he said there was a possibility
that Evergrande may use its offshore assets,
mainly its two Hong Kong-listed subsidiaries,
for offshore restructuring, in which case,
the onshore default will not make a big
difference to offshore investors. Evergrande
Property Services Group and China
Evergrande New Energy Vehicle Group are
listed in Hong Kong.
PAN YUE
timely repayment of the remaining 2022
bond and urged bondholders to exchange
the remaining amount for the new note.
Haitong International Securities was the
solicitation agent and dealer manager,
while DF King was the information and
tabulation agent.
›WANDA GROUP REPURCHASES 2023 NOTE
WANDA GROUP OVERSEAS, a subsidiary of Dalian
Wanda Group, has repurchased US$30.5m,
or 8%, of the principal amount of its
US$380m 8.875% 2023 note.
After the repurchase, the note, guaranteed
by the parent, will have US$349.5m in
principal amount outstanding.
Wanda Group has two bonds outstanding,
including the 2023 note. It also has a
US$550m 7.5% note due on July 24 2022.
The 2022 note was trading at 97.6 on
Thursday, while the 2023 note was trading
at 67.6.
›AGILE REDEEMS ONSHORE BOND
AGILE GROUP HOLDINGSsaid it had deposited
sufficient funds into the designated bank
account of China Securities Depository and
Yunnan Energy Investment units return
„ Loans Group entities raising loans totalling US$1.14bn in both the offshore and onshore markets
Several units of state-owned YUNNAN
PROVINCIAL ENERGY INVESTMENT GROUP are raising
loans totalling US$1.14bn in both the offshore
and onshore markets.
A unit of Yunnan Provincial Energy
Investment Group is back in the market
with a US$300m-equivalent dual-currency
sustainability-linked loan, less than a year
after obtaining another offshore syndicated
borrowing.
China Construction Bank Hong Kong
branch and HSBC are the mandated lead
arrangers and bookrunners of the latest
transaction, which can be increased to up to
US$500m via a greenshoe option.
The bullet loan offers an opening interest
margin of 235bp over Hibor/SOFR, which
will be adjusted based on the guarantor’s
international credit rating.
There is a credit adjustment spread of
26.16bp regardless of the interest period for
US dollar commitments.
MLAs taking US$50m-equivalent or
above will earn a top-level all-in pricing of
279bp over Hibor or 305.16bp over SOFR,
respectively, for commitments in Hong Kong
or US dollars, based on a 120bp fee.
22 International Financing Review Asia July 16 2022
Clearing Corp Shanghai branch to redeem
in full on Wednesday a Rmb1.5bn 6.2%
onshore private placement.
The bond with a maturity date of July 13
2022 was issued by indirect wholly owned
subsidiary Guangzhou Panyu Agile Realty
Development in 2020.
Agile said there will be no material
impact on its financial position as a result
of the redemption.
It has three bonds outstanding that will
become due later this year: a US$200m
5.125% bond and a US$400m 4.85%
bond that both mature in August, and a
Rmb1.5bn 6.2% note issued by Panyu Agile
that is due in October.
The two dollar bonds were trading at
77.125 and 73.5 on Wednesday, while the
onshore note was trading at 60.92.
›ANTA SPORTS SELLS GREEN PANDA
Cayman Islands-incorporated and Hong
Kong-listed ANTA SPORTS PRODUCTS has raised
Rmb500m from a three-year green Panda
bond at a yield of 2.8%.
The bond was priced at par. The final
pricing was within the range of 2.5% to 3.5%
that the company marketed the deal at.
Lead arrangers with US$30m–$49m-
equivalent will earn an all-in pricing of 259bp
or 285.16bp, respectively, based on a 60bp fee.
Arrangers coming in for US$20m–$29m
will earn an all-in of 244bp or 270.16bp,
respectively, based on a 15bp fee.
The all-in calculations include an early-
bird fee of 12bp for banks committing on or
before August 9.
An online bank presentation has been
scheduled for the week of July 18. Final
commitments are due by August 22.
Yunnan Provincial Energy Investment
Group is the guarantor, while Hong Kong-
incorporated YUNNAN ENERGY INVESTMENT (HK) is
the borrower.
Proceeds of the loan will be used to refinance
the company’s existing offshore debt.
Meanwhile, two units of state-owned
Yunnan Provincial Energy Investment Group
are raising loans of up to Rmb5.64bn
(US$840m) combined for the construction of
two wind farms in China’s Yunnan province.
Agricultural Bank of China, China
Construction Bank, China Minsheng Bank,
Huaxia Bank and Ping An Bank will provide a
17-year financing of up to Rmb3.76bn to back
The deal received orders of Rmb1.2bn
from 13 accounts.
The proceeds will be used to support
Anta’s retail headquarters project in
Shanghai, which qualifies as a green
building. The project was launched in 2020
and is expected to be completed in 2023.
Industrial Bank was the lead underwriter
and bookrunner, while China Construction
Bank was the joint underwriter.
SYNDICATED LOANS
›COFCO RETURNS FOR THIRD SLL
Global agricultural commodity trader
COFCO INTERNATIONAL has signed a US$1.6bn
sustainability-linked loan, the company’s
third SLL.
The financing comprises one-year and
three-year revolving credit facilities.
Margins are linked to COFCO’s
achievement of pre-agreed key performance
indicators covering three areas including
the company’s Sustainalytics’ ESG
management score and the traceability and
socio-environmental screening of its direct
supplies of Brazilian soy.
the construction of the Yongning wind farm
in Yunnan’s Honghe county.
Separately, Bank of China, China
Construction Bank and Industrial and
Commercial Bank of China will provide a 17-
year borrowing of up to Rmb1.88bn to back
the construction of the Jinzhong wind farm in
Huize county.
The two wind farms will have a total
capacity of 1,000MW.
Last September, Yunnan Provincial
Energy Investment Group completed its
debut US$395m-equivalent three-year
sustainability-linked loan with 10 lenders,
including mandated lead arrangers and
bookrunners Bank of China (Hong Kong),
China Construction Bank (Asia) and HSBC.
The deal offered a top-level all-in pricing
of 280bp via an interest margin of 235bp
over Libor.
Established in 2012, local provincial
government-owned Yunnan Provincial
Energy Investment is mainly engaged in
investing in and managing the natural gas,
hydropower, power grid and coal energy
businesses.
APPLE LI

Each sustainability target will be audited
annually by an independent third party and
the discount will be applied based on the
KPIs achieved by the company.
Savings made on the margin will be used
to fund COFCO’s environmental and social
assessment on soy supplying farms and ESG
risk management.
“With the increased focus on climate
change and the contribution towards the
UN’s Sustainable Development Goals,
sustainability-linked loans are fostering
a greater interest among financial
institutions than regular, plain vanilla
corporate loans,” Vivek Sharma, COFCO’s
group head of financing, said.
BBVA was global coordinator,
documentation, and facility agent, and
together with Bank of China and SMBC,
sustainability coordinators on the
transaction.
A total of 19 banks from China, Australia,
Europe, Japan, Singapore, and the US
participated in the financing.
COFCO agreed its first SLL in July 2019,
Nine make lacklustre HK debuts
„ Equities Tianqi Lithium erases initial loss after largest IPO in the city this year
Nine stocks made their Hong Kong debut this
week, with most of them trading underwater
while TIANQI LITHIUM, which completed Hong
Kong’s largest IPO so far this year, closed flat
on its first day.
Shares in the lithium producer opened at
HK$74.50 on Wednesday, or 9.1% in the red,
before clawing back the lost ground to close
at the issue price and day’s high of HK$82.
They were trading at HK$79.70 around
lunchtime on Friday.
The company raised HK$13.4bn (US$1.7bn)
from its IPO.
“It is encouraging to see the stock opened
weak but closed flat given that trading in
Tianqi’s A-shares has been really volatile
recently,” an ECM banker said.
The institutional tranche of its IPO was
5.2x subscribed and the retail tranche 9.3x
covered.
CICC, CMB International and Morgan
Stanley were the sponsors.
On the same day, NOAH HOLDINGS closed
at HK$279, 4.5% below the issue price of
HK$292.
The wealth management company raised
HK$321m from a secondary listing.
The institutional tranche was 5.9x
subscribed and the retail tranche 3.26x
covered.
Goldman Sachs was the sponsor.
raising a US$2.3bn jumbo comprising one-
year and three-year revolvers and a three-
year term loan.
The company then agreed a US$700m
three-year SLL in September 2021.
COFCO International, which has its
head office in Switzerland, is the overseas
agriculture business platform for COFCO
Corp, China’s largest food and agriculture
company.
›CHENGTUN MINING TAPS US$100M LOAN
Shanghai-listed Chengtun Mining Group is
in the market with a US$100m three-year
loan.
Standard Chartered is the sole mandated
lead arranger and bookrunner of the
financing, which offers an interest margin
of 200bp over SOFR and has an average life
of 2.6 years.
MLAs taking US$30m and above will
earn a top-level all-in of 245bp based on
a fee of 117bp, while lead arrangers with
US$20m–$29m will receive an all-in of
MINISO GROUP HOLDING closed at HK$13.38,
3% below the issue price of HK$13.80 per
share.
The budget store chain’s dual primary
listing raised HK$567m.
The institutional tranche was 4.84x
subscribed and the retail tranche 1.4x
covered.
Bank of America, Haitong International and
UBS were sponsors.
HUZHOU GAS closed at HK$5.60, 7.9% below
the IPO price of HK$6.08 per share.
The piped natural gas distributor’s IPO
raised HK$304m.
The institutional tranche was 1.18x
subscribed and the retail tranche 8.08x
covered.
BoCom International was the sponsor.
On Tuesday, READBOY EDUCATION’s shares
closed at HK$7.20, down 5.3% from the IPO
price of HK$7.60 per share.
Readboy raised HK$395m from its IPO.
China Securities International and
Macquarie were sponsors.
SINOHEALTH HOLDINGS’ shares closed flat
following the healthcare insight services
provider’s HK$402m Hong Kong IPO.
The stock opened at HK$4.74 or 11.6%
below the IPO price and closed at HK$5.36,
the same as the IPO price.
BNP Paribas was the sponsor.
International Financing Review Asia July 16 2022 23
COUNTRY REPORT CHINA
235bp via a 91bp fee. Arrangers coming
in for US$10m–$19m will get an all-in of
225bp via a 65bp fee.
WANG SING INTERNATIONAL RESOURCES is the
borrower, while parent Chengtun Mining
Group is providing a guarantee.
A bank presentation is scheduled for
July 18, with commitments due August
19.
Proceeds will be used for general
corporate and refinancing purposes.
Xiamen-based Chengtun Mining is
principally engaged in the mining and
trading of nonferrous metals.
EQUITY CAPITAL MARKETS
›BEISEN PLANS HK IPO
BEISEN HOLDING,
which provides cloud-based
human capital management services, is
planning to raise US$200m from a Hong
Kong IPO, said people with knowledge of
the matter.
On Friday, three more stocks made their
stock market debuts following IPOs, with a
mixed performance.
Shares in MICROPORT NEUROTECH, a unit
of Hong Kong-listed MicroPort Scientific,
opened at HK$24.70, 0.2% above the IPO
price of HK$24.64.
The manufacturer of neuro-interventional
medical devices raised HK$338m from
its IPO. The retail tranche was 45.27x
covered and the institutional tranche 2.14x
subscribed.
CICC and JP Morgan were the sponsors.
DEEWIN TIANXIA opened at HK$1.75, 2.8%
below the IPO price of HK$1.80.
The company, which provides logistics,
supply chain and financial services to
automobile makers, raised HK$977.4m. The
retail tranche was 0.42x covered and the
institutional tranche 1.41x subscribed.
China Securities International was the
sponsor.
BOARDWARE INTELLIGENCE TECHNOLOGY opened
at HK$1.14, 5.6% above the IPO price of
HK$1.08.
The Macau-based IT services provider
raised HK$135m from its IPO. The retail
tranche was 10.69x covered and the
institutional tranche was 1.03x subscribed.
China Tonghai Capital was the sponsor.
SUNNY TSE
 Morgan Stanley and CICC are the joint sponsors.
The company first filed a listing
application in January and refiled it on July
11 after the original filing expired.
It posted a loss of Rmb1.9bn (US$284m)
for the year ended March 31 2022,
compared to a Rmb940m loss a year earlier.
SoftBank Group owns 6% of Beisen,
which was established in 2005. Its other
shareholders include Genesis Capital,
Fidelity International and Sequoia Capital
China.
›HUA XIA BANK FOLLOW-ON APPROVED
Shanghai-listed HUA XIA BANK has won final
written approval from the China Securities
Regulatory Commission for an up to
Rmb20bn private share placement.
The lender plans to offer up to 1.5bn
shares to not more than 35 investors.
Proceeds will be used to replenish core
Tier 1 capital.
It posted a 2021 net profit of Rmb23.5bn,
up 10.6%, as revenue rose 0.6% to
Rmb95.9bn.
China Securities is the sponsor.
›SHENZHEN BLUETRUM FALLS ON DEBUT
Wireless audio chip producer SHENZHEN
BLUETRUM TECHNOLOGY closed at Rmb64.30 on
its Shanghai Star debut Friday, down 29.8%
from the issue price of its Rmb2.75bn IPO.
The company sold 30m shares, or 25%
of the enlarged capital, at Rmb91.66 each,
which translates to a 2021 P/E of 56.41,
compared with the industry average of
27.4.
Proceeds will be used on Bluetooth audio
chip R&D and production, the construction
of an R&D centre, and for a development
and technology reserve fund. The original
fundraising target was Rmb1.6bn.
It posted a 2021 net profit of Rmb229m
on revenue of Rmb1.12bn.
CICC is the sponsor.
›SHIDA SHENGHUA CHEMICAL PLANS SALE
Shanghai-listed SHANDONG SHIDA SHENGHUA
CHEMICAL GROUP plans to raise up to Rmb4.5bn
from a proposed private share placement.
The organic chemical products
manufacturer will offer up to 60.8m shares,
equivalent to 30% of current shares, to up
to 35 investors.
Proceeds will be used for lithium battery
material projects and working capital.
It posted a 2021 net profit of Rmb1.18bn,
more than four times 2020’s Rmb260m, as
revenue rose 57% to Rmb7.06bn.
Its shares are down 29% year to date.
The proposal still needs approval from
shareholders and regulators.
24 International Financing Review Asia July 16 2022
›SUPER HI TO LIST BY INTRODUCTION
SUPER HI INTERNATIONAL has
applied for a listing
by introduction in Hong Kong, meaning no
funds will be raised.
Morgan Stanley and Huatai International are
the sponsors.
As of March 31, Super Hi had a network
of 97 restaurants in 11 countries in Asia,
North America, Europe and Oceania.
The overseas restaurant business unit
of hotpot chain Haidilao International
posted a loss of Rmb28.5m in the first three
months in 2022, compared to a Rmb25.2m
loss a year earlier.
›WANTAI COMPLETES FOLLOW-ON
Shanghai-listed BEIJING WANTAI
BIOPHARMACEUTICAL has completed a Rmb3.5bn
private share placement.
It sold 25.9m shares to eight investors at
Rmb135.33 each, a 12.8% premium to the
floor price of Rmb120.
Assicurazioni Generali and China
National Petroleum-backed Generali
China subscribed to Rmb1bn of the deal.
The company’s biggest shareholder,
Yangshengtang Co, which is also the parent
of Hong Kong-listed Nongfu Spring, bought
Rmb350m.
Proceeds will be used to expand the
production of 9-valent cervical cancer and
pneumonia vaccines, for R&D of nasal spray
vaccines for Covid-19 and the production of
in vitro diagnostic reagents.
It posted a net profit of Rmb2.02bn for
2021, up from Rmb677m a year earlier,
as revenue rose 144% to Rmb5.75bn. The
company said revenue was boosted by
the sales of vaccines for 2-valent cervical
cancer.
Its shares have dropped 21% in the past
12 months.
Sinolink Securities is the sponsor and joint
bookrunner with CICC and Citic Securities.
›AIMA TECH GROUP PREPARES CB
Shanghai-listed AIMA TECHNOLOGY GROUP plans
to raise up to Rmb2bn from a proposed six-
year convertible bond.
The electric bicycle manufacturer will
use the proceeds for production (Rmb1.5bn)
and marketing.
The company raised Rmb1.81bn by
selling 65m shares at Rmb27.86 each
from a Shanghai IPO in June 2021. Citic
Securities was the sponsor.
It posted a net profit of Rmb664m on
revenue of Rmb15.4bn for 2021.
Its shares have doubled in the past nine
months.
The proposal still needs approval from
shareholders and regulators.
›JIAYUAN SELLS CB
Property developer JIAYUAN INTERNATIONAL
GROUP has sold a HK$667m (US$85m)
convertible bond to eight investors.
Jiayuan said it priced the 364-day CB at
an 8% coupon and a conversion premium of
56.3% to July 1’s close of HK$0.435.
It is understood that the deal was self led
by the company.
The company plans to use the proceeds
for the repayment of liabilities and as
general working capital.
In July last year, Jiayuan raised US$100m
from a 3.5-year green CB, the first offshore
green equity-linked issue from a Chinese
issuer.
Shares in Jiayuan fell 3.5% to HK$0.42 on
Monday, after rising as much as 17.2% at
one point.
›SHANDONG HI-SPEED APPROVES UNIT CB
Shenzhen-listed SHANDONG HI-SPEED ROAD
AND BRIDGE has received approval from its
parent, Shandong Hi-Speed Group, to issue
a Rmb5bn six-year convertible bond.
It will use the proceeds to fund the
construction of expressways, industrial
parks and public roads, replenish working
capital and repay bank loans.
The board approved the proposal in July
2021, but the company has not filed for it
yet.
Its shares have surged 71.2% year to date.
HONG KONG
DEBT CAPITAL MARKETS
›CDB HK PRINTS IN TWO CURRENCIES
CHINA DEVELOPMENT BANK HONG KONG BRANCH, rated
A1/A+/A+, has sold a Rmb2.5bn (US$371.5m)
2.95% five-year Dim Sum bond, along with a
HK$3.5bn (US$520m) 2.85% two-year note.
Both bonds were priced at par. CDB had
marketed both notes at initial guidance of
3.4% area each.
The order book reached Rmb12.2bn,
including Rmb5.9bn from the leads, for the
Dim Sum bond, and HK$11.36bn, including
HK$8.69bn from the leads, for the HK dollar
bond when final guidance, which was the
same as the final pricing, was announced.
Settlement is set for July 19. Proceeds
from the Hong Kong-listed deals will be
for working capital and general corporate
needs.
Agricultural Bank of China, Bank of China,
Bank of Communications, BNP Paribas, China

Citic Bank International, China Construction
Bank Asia, China International Capital
Corporation, CMB Wing Lung Bank, Credit
Agricole CIB, DBS Bank, HSBC, ICBC Asia,
Industrial Bank HK, Mizuho Securities,
Scotiabank, Shanghai Pudong Development Bank
HK and Standard Chartered were joint global
coordinators, joint lead managers and
bookrunners for both transactions.
SYNDICATED LOANS
›FWD PARENT IN TALKS TO REFI LOAN
PCGI HOLDINGS, parent of Hong Kong insurer
FWD Group, is in talks with relationship
banks to refinance a pre-IPO loan it raised
last year.
The size and terms of the latest deal are
still to be determined.
The loan is likely to carry a letter of
comfort from FWD founder and Hong
Kong-based tycoon Richard Li.
Last year, PCGI obtained a pre-IPO
financing of approximately US$600m–
$800m from a handful of relationship
banks.
In May this year, the company put its
Hong Kong IPO of about US$1bn on hold
amid challenging market conditions, IFR
Asia reported.
FWD Group announced on July 8 the
appointment of Frederick Ma Si-hang,
former finance minister of Hong Kong, as
its new chairman.
The appointment of Ma is expected to
help the company resume its postponed
IPO, according to local media reports.
FWD obtained a US$1.5bn three-year loan
from 10 banks in March.
Proceeds of that loan were for general
corporate purposes and to refinance a
borrowing that had backed the company’s
acquisition of the life insurance unit of
Siam Commercial Bank in 2020.
Established in 2013, FWD Group is a
pan-Asian life insurance business with
approximately 10 million customers across
10 markets.
›K WAH TAPS REFI FOR 2018 BORROWING
Hong Kong property developer K Wah
International Holdings has approached
banks for a dual-tranche loan to refinance
a HK$7bn (US$892m) club borrowing from
2018.
The latest transaction will carry
maturities of four and five years.
Banks are working on credit approvals to
join the deal in the senior phase.
The five-year club loan from January
2018 offered an all-in pricing of 97bp over
Hibor based on an interest margin of 82bp.
K WAH FINANCIAL SERVICES is the borrower,
while Hong Kong-listed parent K Wah
International Holdings is guarantor for that
borrowing.
Last October, the company obtained a
HK$8bn dual-tranche loan from 11 banks,
including Bank of China (Hong Kong), Bank
of Communications, DBS Bank, Hang Seng
Bank, HSBC and OCBC Bank as original
mandated lead arrangers and bookrunners.
China Minsheng Banking Corp and
Industrial & Commercial Bank of China
(Asia) were MLABs.
The borrowing offered a top-level all-in
pricing of 96bp via a margin of 83bp over
Hibor.
K Wah International Holdings is the
listed property arm of conglomerate K
Wah Group, with a strategic focus on Hong
Kong, the Yangtze River Delta and the Pearl
River Delta regions.
›HOPE EDUCATION CUTS LOAN SIZE
Chinese vocational education provider
HOPE EDUCATION GROUP has cut its three-year
financing to HK$620m from the original
HK$1bn target.
Standard Chartered was the sole mandated
lead arranger and bookrunner of the
transaction.
Three lenders joined in syndication
which lasted for five months, highlighting
the challenges faced by China’s education
sector since a sweeping regulatory
crackdown was announced last year.
The loan offered a top-level all-in pricing
of 260bp, based on an interest margin of
225bp over Hibor and an average life of
2.75 years.
Hong Kong-listed Hope Education Group
is the borrower, while wholly owned
Hope Education Group (Hong Kong) is the
guarantor.
Proceeds are for general corporate
purposes.
In July 2021, the Chinese government
announced the crackdown on the education
sector that included a ban on any for-profit
tutoring services focused on the country’s
core public school curriculum, and
restricting class schedules to no later than
9.00pm on weekdays.
Hope Education provides vocational
education services, which are being
encouraged. In October, the government
rolled out a set of policy measures aimed at
beefing up support for vocational schools
and improving the quality of skill-focused
education.
Hope Education operates 20
undergraduate and junior colleges in 10
provinces and municipalities, of which
seven are undergraduate colleges, 11 are
higher vocational colleges, and two are
International Financing Review Asia July 16 2022 25
COUNTRY REPORT HONG KONG
technical colleges, with student enrolment
reaching 232,000, the company said in its
2021 annual report.
For full allocations, see www.ifre.com.
›PROSPERITY REIT EYES SUSTAINABILITY
PROSPERITY REAL ESTATE INVESTMENT TRUST has signed
its first sustainability-linked interest rate swap
with DBS Bank Hong Kong branch, following its
maiden five-year HK$800m sustainability-
linked loan with the bank last year.
DBS is the sole hedging bank and
will provide an interest rate hedge for
Prosperity REIT’s bank facilities, according
to a press release on July 11 from the
Singaporean bank and the REIT manager,
ARA Asset Management (Prosperity), a
wholly owned subsidiary of ARA Asset
Management.
Prosperity REIT will also collaborate with
the Evangelical Lutheran Church of Hong
Kong to initiate at least two community
events this year.
Upon completion of the events,
Prosperity REIT will be entitled to a
sponsorship from DBS Hong Kong to
help further its efforts on “Sustainability
Vision 2030”, which focuses on nature,
people, building/services and community
initiatives.
Prosperity REIT will be eligible for a
reduction in the SLL’s interest rate upon
achieving pre-determined environmental,
social and governance performance metrics.
Those metrics include the green building
certification of its property portfolio, a
reduction in energy consumption and
greenhouse gas emissions from the REIT’s
property management operations, and
promoting the use of renewable energy
through the installation of solar panels and
rainwater collection systems at selected
properties.
Hong Kong-listed Prosperity REIT owns
a portfolio of seven properties in the
decentralised business districts of Hong
Kong, comprising all, or a portion of,
Grade A office, commercial and industrial
buildings, with a total gross rentable area of
about 1.28 million square feet.
›BETTERLIFE UNIT BAGS BILATERAL
A unit of Chinese car dealership Betterlife
Holding has obtained a HK$155m one-year
bilateral loan, while the parent is wrapping
up its debut offshore syndicated loan.
Bank of China funded the deal for
borrower BETTERLIFE INTERNATIONAL MOTOR,
according to a Hong Kong stock exchange
filing on July 12.
Meanwhile, Hong Kong-listed BETTERLIFE
HOLDING is wrapping up a HK$780m
syndicated loan.
 DBS Bank is the mandated lead arranger
and bookrunner of the three-year
financing, which offers a top-level all-in
pricing of 340bp via an interest margin of
300bp over Hibor and an average life of
2.775 years.
Betterlife Holding is the borrower, while
certain subsidiaries, including BetterLife
International Motor, BetterLife Tianjin
Management Group and Beijing Betterlife
Automobile Import & Export Group, are the
guarantors of the loan.
Proceeds will be used for general
corporate purposes, refinancing, capital
expenditure and investment.
Founded in 1996, Betterlife Holding
provides automobile dealership services in
China, and mainly focuses on luxury and
ultra-luxury brands.
›MUFG LAUNCHES GREEN DEPOSITS IN HK
MUFG Bank has signed SANKYO SEIKO (ASIA
PACIFIC) as its first client for the launch of
the Japanese bank’s green deposits product
in Hong Kong.
The green deposits carry tenors of one to
12 months and allow a customer to place
term deposits with MUFG, which are then
used to fund qualifying green loans for
projects such as clean transportation, green
building, energy efficiency and sustainable
water/wastewater management, the bank
said in a press release on July 13.
MUFG launched its green deposits in
Australia in April, supporting Sydney Airport.
Sankyo Seiko is a Japanese company
specialising in retail and wholesale apparel
and textiles.
EQUITY CAPITAL MARKETS
›C&D UPSIZES PLACEMENT
Property developer C&D INTERNATIONAL
INVESTMENT has raised HK$510m (US$65m)
from the sale of 30m shares at a fixed
price of HK$17 apiece, according to a stock
exchange announcement.
The transaction was upsized to 30m
shares from 23.2m. The shares sold
represent 2.02% of the expanded capital.
The offer price was at a 7.9% discount to
the pre-deal close of HK$18.46.
There is a 90-day lock-up on the company.
The funds will be used to repay loans.
CICC and Industrial Securities International
were the bookrunners.
›DAYDAYCOOK DROPS SPAC PLAN
Hong Kong-based online recipe publisher
and food merchandiser DAYDAYCOOK said
on Tuesday it still plans to go public on
Nasdaq, though not via a SPAC merger
after it terminated its planned union with
Eugene Wong’s ACE GLOBAL BUSINESS ACQUISITION.
Reports first surfaced in 2020 that the
10-year-old company was planning a US$80m
Nasdaq IPO valuing it at US$400m–$500m.
But with US investors steering clear of new
issue product with a Chinese flavour (after
the DiDi Global debacle a few weeks earlier),
DayDayCook last August went down the
then-popular SPAC merger route, agreeing to
terms for a US$387m combination including
a US$30m–$40m PIPE.
On Tuesday, the parties announced the
SPAC deal had been cancelled (just one in a
lengthening list of announced SPAC deals),
though DayDayCook framed the news as
the company pivoting back to a traditional
IPO on Nasdaq.
It is not clear when that will happen
given the regular new issue market is
not in much better shape than the SPAC
business, but founder and CEO Norma Chu
said the company’s efforts were “perhaps
best concentrated on taking a more direct
path via an IPO on Nasdaq”.
Fortuitously, DayDayCook separately
announced a pre-IPO funding round of
undisclosed magnitude with participation
from new investors Brinc and Esquel
Ventures (both Hong Kong-based), alongside
existing investor C Ventures, a VC firm
backed by Hong Kong conglomerate New
World Development’s CEO, Adrian Cheng.
The extra funds would enable DayDayCook
“to continue to grow its customer base
as well as execute accretive acquisition
opportunities both in China and in Southeast
Asia markets”, the company said.
In a March investor presentation,
DayDayCook estimated its 2021 revenue
at US$46.6m with a negative Ebitda of
US$10.5m.

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26 International Financing Review Asia July 16 2022


INDIA
DEBT CAPITAL MARKETS
›CONTINUUM TAKES PRIVATE ROUTE
Renewable power company CONTINUUM GREEN
ENERGY has raised US$350m from privately
placed senior secured floating-rate notes.
The notes were placed with two
international institutional investors, with
an option to issue an additional US$50m on
fulfillment of certain conditions.
Deutsche Bank was sole placement agent.
“Raising of funds from marquee
investors reaffirms the faith of investors
in Continuum’s business model and the
company’s focus on building high quality
projects,” said Arvind Bansal, founder and
CEO of Continuum, in a release.
In April, Continuum Energy Aura, a
subsidiary of Continuum Green Energy,
held investor calls for a proposed US dollar
144A/Reg S senior secured 3.5-year green
bond of up to US$400m. However, it was
unable to complete the deal due to poor
market conditions.
The issuer and the notes were to be rated
BB– by S&P.
The latest deal is the second privately
Vedanta bonds fall despite easing liquidity risk
„ Bonds Bank loans and hefty dividend income should help the group meet near-term obligations
The liquidity risk is easing for VEDANTA
RESOURCES with debt maturities falling to
US$1.3bn for the rest of the fiscal year to
March 2023 from US$3bn at the start of April
this year, according to S&P.
Last week, the domestic subsidiary
of Hindustan Zinc, in which Vedanta
Resources has an indirect stake of 45.2%,
announced an interim dividend of Rs21
per share, totalling Rs88.7bn (US$1.1bn),
with the record date set for July 21. Around
US$470m of the dividend will be paid to
Vedanta Resources, according to Nomura
International.
S&P expects the company will meet half
of the remaining US$1.3bn debt maturity
from dividends at Vedanta Ltd and the
rest will be refinanced from loans from
Indian banks, similar to the US$700m in
loans which it raised in May and June this
year.
Vedanta Ltd will consider an interim
dividend at a July 19 board meeting after it
placed US dollar bond transaction from
India recently as the offshore public
markets remain frozen.
In May, Mumbai International Airport
raised US$750m from a private placement
of 7.25-year notes with Apollo-managed
credit funds.
Continuum will use the funds to expand
its portfolio from 1.3 gigawatts to 2.5GW.
The majority of its capacity is wind and
solar hybrid projects, servicing commercial
and industrial consumers.
The fundraising will enable the
company to meet its sustainability goals
economically, said Bansal.
Continuum is majority-owned by a global
infrastructure fund managed by Morgan
Stanley Infrastructure Partners.
›JUBILANT TO REDEEM EARLY
JUBILANT PHARMA’sSingapore unit is planning
an early redemption of its US$200m 6%
senior bonds due 2024, according to a
release.
The company said it has given
conditional notice to bondholders to
exercise the option to redeem the bonds by
August 18.
It will pay 103% of the principal amount,
plus accrued and unpaid interest.
Recently, Jubilant Pharma launched a
US$400m five-year loan syndication with
announced record dividend of US$1.5bn on
May 28, of which US$1bn flowed up to the
parent.
Vedanta Resources delevered about
US$1bn last quarter, as part of its attempts
to reduce its gross debt. The company
announced in a stock exchange filing on
July 4 that it raised about US$1bn in the first
quarter of fiscal 2023. The new debt includes
the US$700m from Indian banks, with
average maturities of more than three years
at a cost of 450bp over SOFR.
The company has committed to reduce its
gross debt by US$4bn over the next three
financial years.
However, Vedanta’s bond prices remain
depressed due to the recent decline in
commodity prices, the impact of a windfall
tax by Indian government on oil producers
and lingering concerns over upcoming debt
repayments.
The yield on Vedanta Resources’ 8.95%
US dollar bonds due March 11 2025 climbed
International Financing Review Asia July 16 2022 27
COUNTRY REPORT INDIA
Standard Chartered to repay the 2024 bonds,
as well as a US$150m three-year club loan.
›SIDBI MEETS TARGET
has
SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA
raised Rs30bn (US$377m) from bonds due
July 21 2025 at 7.15%, according to a NSE
filing.
It was targeting Rs10bn plus a greenshoe
of Rs20bn.
Care and Icra have assigned a AAA rating
to the unsecured bonds.
›NON-BANK LENDERS COME OUT IN FORCE
Non-bank lenders CHOLAMANDALAM INVESTMENT
AND FINANCE, TATA CAPITAL HOUSING FINANCE and
LIC HOUSING FINANCE raised a total of Rs52.3bn
from bonds, according to filings on NSE.
Cholamandalam raised Rs8bn from
the sale of January 14 2026 bonds at an
effective yield of 7.94%. The notes are rated
AA+ by Icra.
Tata Capital Housing Finance printed a
total of Rs4.3bn from existing bond lines.
The housing financier raised Rs265m from
a tap of its 8.05% June 25 2032 notes at a
clean price of 100.41 and an effective yield
of 7.98%. It raised Rs4bn from a tap of its
7.75% May 18 2027 bonds at a clean price
of 99.16 and an effective yield of 7.95%. The
bonds are rated AAA by Icra.
to 24.77% July 14, close to an all-time high of
25.8% on July 6, as the price tumbled to 70.5
cents. The yield on its 9.25% dollar notes due
April 23 2026 surged to 29.94%, close to an
all-time high of 30.5% on July 13, as the price
plunged to 55 cents. The 7.125% note due
May 31 2023 was yielding 48.6% as the price
dropped to 73.12 cents, according to Refinitiv
data.
S&P has revised Vedanta’s Ebitda estimate
lower to US$5.5bn for the current fiscal
year from an earlier estimate of US$6.4bn–
$6.8bn due to the drop in commodity prices
and the windfall tax.
India imposed a windfall tax of Rs23,250
per tonne on oil producers and refiners who
have increased exports to gain from higher
overseas margins on July 1. This comes as the
government seeks to ensure rising domestic
demand for fuel can be met, but also to
increase its revenues amid a high fiscal
deficit.
KRISHNA MERCHANT
 LIC Housing raised Rs15bn from a tap of
7.9% June 23 2027 bonds at an effective yield
of 7.79% and it sold a Rs25bn tap of 7.61%
July 30 2025 bonds at an effective yield of
7.54%. The notes are rated AAA by Crisil.
›INDIABULLS SEALS LONG-TENOR PRINT
has raised Rs5bn
INDIABULLS COMMERCIAL CREDIT
from 10-year bonds at 11.5%, according to a
BSE filing.
Crisil and Brickwork have assigned a AA+
rating to the secured bonds.
The coupon will step up by 25bp for every
notch rating downgrade. If the rating falls to
A or below, the debenture holders can ask
for repayment of the outstanding principal.
›HPCL PRINTS SHORT TENOR
HINDUSTAN PETROLEUM CORP has raised Rs18bn
from three-year 15-day bonds due July 30
2025 at 7.12%, according to a filing on BSE.
The oil and gas refining company was
eyeing Rs5bn plus a greenshoe of Rs13bn.
Crisl, Icra and India Ratings have
assigned a AAA rating to the bonds.
›HDFC PLANS SHORT FIVERS
HOUSING DEVELOPMENT FINANCE CORP plans to
raise up to Rs50bn from bonds due June 28
2027 at 7.77%, according to market sources.
The non-bank lender is eyeing Rs25bn
plus a greenshoe of the same amount.
Crisil and Icra have assigned a AAA rating
to the bonds. Axis Bank is the arranger.
The issuer is yet to make an official
announcement on the planned bond sale.
On July 8, HDFC returned to the
syndicated loan market for a five-year
loan of up to US$750m. On July 1, it raised
Rs40bn from March 1 2024 bonds at 7.28%.
HDFC said in April it will merge with
HDFC Bank, the country’s largest private
sector lender. The merged entity will have a
combined balance sheet of Rs17.87trn and a
net worth of Rs3.3trn.
›CANARA BANK PLANS AT1
CANARA BANK plans to raise up to Rs20bn
from Basel III-compliant Additional Tier 1
bonds with a call option after five years,
according to market sources.
It is targeting Rs5bn plus a greenshoe
of Rs15bn. Crisil has assigned a AA+ stable
rating to the bonds.
The issue comes after Punjab National
Bank on July 4 sold Rs20bn of non-call five
AT1s at 8.75%, 35bp more than the 8.4% it
paid on the perps it printed on December
13 last year.
The issuer is yet to make an official
announcement on the planned bond sale.
28 International Financing Review Asia July 16 2022
SYNDICATED LOANS
›BIOCON LAUNCHES ACQUISITION LOAN
BIOCON BIOLOGICS, a subsidiary of India-listed
pharmaceuticals company Biocon, has
launched into syndication its US$1.2bn loan
backing the acquisition of assets from US-
based Viatris.
Mandated lead arrangers and
bookrunners HSBC and Standard Chartered
have each underwritten US$500m of the
five-year amortising loan, while MUFG is
providing US$200m.
The borrowing, which may be converted
later into a sustainability-linked loan, pays
a top-level all-in of around 190bp based on
an interest margin of 175bp over SOFR and
a four-year average life.
Banks have been invited to join at two
levels with commitments of US$150m and
above and US$100m–$149m.
Commitments are due by the second
week of August.
A newly formed entity will be the
borrower, while Biocon Biologics will
provide a guarantee.
In late February, BBL announced that
it had agreed to acquire the biosimilars
business of Pennsylvania-headquartered
Viatris for up to US$3.335bn in cash and
equity.
Viatris will receive a cash consideration
of US$2bn on the closing of the transaction
and up to US$335m as additional payments
expected to be paid in 2024.
The transaction is expected to close in
the second half of 2022, subject to the
satisfaction of closing conditions and
regulatory approvals.
Upon closing, BBL will also issue US$1bn
of compulsorily convertible preference
shares to Viatris, equivalent to an equity
stake of at least 12.9% in the company, on a
fully diluted basis.
›JUBILANT PHARMA SEEKS US$400M LOAN
Singapore-incorporated Jubilant Pharma
has launched a US$400m five-year loan into
limited syndication.
Standard Chartered is the sole mandated
lead arranger and underwriter of the
facility, which pays top-level all-in pricing
of 218bp based on an interest margin of
198bp over term SOFR and an average life
of 4.5 years.
Subsidiary JUBILANT PHARMA HOLDINGS is the
borrower of the facility, which may be
converted into a sustainability-linked loan
later.
Jubilant Pharma and certain other
subsidiaries will act as guarantors.
Commitments are due in the third week
of August.
Part of the new loan will be used to repay
a US$150m three-year club loan signed
in January 2021 and Jubilant Pharma’s
US$200m 6% bonds due in March 2024.
Axis Bank, DBS Bank and StanChart were
the lenders on the 2021 loan, according to
Refinitiv LPC data. That loan refinanced
US$200m in bonds maturing in October
2021.
Jubilant Pharma, a wholly owned
subsidiary of India-listed Jubilant Pharmova,
makes radiopharmaceuticals, allergy
therapy products, and sterile injectables. It
has manufacturing facilities and research
and development centres in North America
and India.
›REC SEEKS EURO LOAN
State-owned REC has sent a request for
proposals for an unsecured US$75m-
equivalent euro-denominated borrowing
with an unspecified greenshoe.
The infrastructure finance company
has asked for proposals in euros linked to
three-month Euribor or any other currency
swapped into euros.
The facility could comprise a five-year
bullet term and/or seven-year door-to-door
piece with equal amortising repayments
after five, six and seven years.
The deadline for proposals is July 26.
Proceeds will be used for funding power
infrastructure in India.
REC closed a US$325m-equivalent five-
year yen loan in May that offered top level
all-in pricing of 98.9bp based on an interest
margin of 81bp over the daily compounded
Tonar benchmark and a remaining life of
4.75 years.
Bank of India, Mizuho Bank and
Sumitomo Mitsui Banking Corp were the
mandated lead arrangers and bookrunners
of the pre-funded facility.
The yen borrowing is part of a larger
US$1.5bn loan. A US$975m piece of the
remaining US$1.175bn five-year financing
attracted 11 banks in syndication in
March.
The dollar loan paid a top-level all-in of
115bp based on a margin of 98bp over Libor
and a remaining life of 4.75 years.
Axis Bank, Bank of Baroda, DBS Bank,
MUFG and SMBC were the MLABs of the
syndicated facility.
Bank of India and Canara Bank funded
a US$200m portion that was not syndicated.
EQUITY CAPITAL MARKETS
›SIGNATURE GLOBAL FILES FOR IPO
Property developer SIGNATURE GLOBAL INDIA has
filed for a Rs10bn (US$125m) IPO.

Primary shares totalling Rs7.5bn and
Rs2.5bn of secondary shares will be on
offer, the company said in the draft
prospectus.
Controlling shareholder Sarvpriya
Securities and investor shareholder
International Finance Corp are the
vendors.
Total income in the financial year to
March 2022 was Rs9.4bn, up from Rs1.5bn
in FY2021. Its net loss widened 39% to
Rs1.2bn from Rs863m.
Axis Capital, ICICI Securities and Kotak
Mahindra Capital are the lead managers.
›BIDS SOUGHT FOR HINDUSTAN ZINC SALE
The Department of Investment and Public
Asset Management has invited bids from
banks to manage the sale of the Indian
government’s 29.5% residual stake in
HINDUSTAN ZINC.
The shares will be sold in tranches
in the stock markets. At current prices
the stake is valued at a maximum
Rs321bn.
Bids have to be submitted by July
28. Up to five banks will be hired and
the mandate will be valid for two years
and can be extended by one more
year.
Vedanta currently owns 64.9% of the
company and the public 5.5%.
Hindustan Zinc shares are down 10% year
to date.
Pertamina Hulu’s debut loan hits syndication
„ Loans Proceeds are for general corporate purposes, including investments
PERTAMINA HULU ENERGI, an upstream unit
of Indonesian state-owned energy firm
Pertamina, has launched its debut multi-
tranche loan of US$2.5bn into general
syndication.
Bank of China, Bank Mandiri, Bank of
Negara Indonesia, Credit Agricole CIB,
Maybank, Mizuho Bank, MUFG, Sumitomo
Mitsui Banking Corp and United Overseas
Bank are the mandated lead arrangers,
bookrunners and underwriters of the partly
pre-funded deal.
The financing – which carries an accordion
option of up to US$900m – comprises an
amortising US$1.7bn five-year piece (Facility
A1), a US$400m amortising seven-year
portion (Facility A2) and a US$400m two-
year bullet tranche (Facility B1).
Facility A1 pays an interest margin of 90bp
(offshore) and 100bp (onshore) over term
SOFR and has an average life of 2.75 years,
INDONESIA
DEBT CAPITAL MARKETS
›INDIKA ACCEPTS BUYBACK
Integrated coal miner INDIKA ENERGY has
accepted to buy back US$184m of the
5.875% 2024 bonds and US$56.7m of the
8.25% 2025 notes under a tender offer that
ended on July 7.
The Indonesian company had planned
to buy up to US$250m of the outstanding
bonds at a price to be set by a modified
Dutch auction, comprising up to
US$200m of the 2024s and US$50m of
the 2025s. The respective bonds have
US$575m and US$675m outstanding.
The acceptable price range had been set
at US$977.50–$1,007.50 for the 2024s and
US$1,002.50–$1,025 for the 2025s.
Indika said in an SGX statement on July
8 that it had accepted all US$183.967m
of the 2024s submitted at an aggregate
purchase price of US$184.974m.
The clearing price had been set at
US$1,007.50. After settlement of these
notes plus the planned cancellation of
US$28.637m of the 2024s bought in the
open market prior to the tender, the
remaining balance of the 2024s will be
US$362.396m.
while facility A2 offers a margin of 110bp
(offshore) and 120bp (onshore) and has an
average life of 3.75 years.
Facility B1, meanwhile, pays a margin of
50bp (offshore) and 60bp (onshore) and has
a remaining life of 1.75 years.
Only Facility A1 and B1 will be syndicated.
All tranches carry a credit adjustment
spread of 25bp for the first three months. The
CAS for facilities A1 and A2 increases to 35bp
for each subsequent interest period, while
Facility B1 rises to 30bp.
MLAs with an aggregate initial
commitment amount of US$75m and above
will be offered a participation fee of 33bp for
Facility A1 and 22bp for Facility B1, while lead
arrangers with US$35m–$74m will receive
a 22bp and 15bp fee for the two tranches,
respectively.
Meanwhile, arrangers committing
US$15m–$34m will earn a 11bp and 10bp fee
International Financing Review Asia July 16 2022 29
COUNTRY REPORT INDONESIA
Applications to tender the 2025s
amounted to US$226.93m. Indika fixed
the clearing price at US$1,002.50 and will
accept for purchase US$56.571m at an
aggregate purchase price of US$56.712m.
After settlement of these notes and the
planned cancellation of US$19.55m of the
2025s bought in the open market prior to
the tender, the remaining balance of the
2025s will be US$598.879m.
Settlement of the tender offers is due on
July 14.
Morrow Sodali was the information and
tender agent. Mandiri Securities and Standard
Chartered are the dealer managers.
›PROTELINDO TO SELL THREE-TRANCHER
PROFESIONAL TELEKOMUNIKASI INDONESIA, or
Protelindo, plans to raise up to Rp1trn
(US$66m) from a three-tranche bond
offering in August, according to a
prospectus.
Indonesia’s largest independent tower
operator is targeting yield ranges of 3.75%–
5.00% for a 370-day tranche, 5.80%–7.00%
for a three-year piece and 6.45%–7.50% for a
five-year portion.
Books opened on July 15 and will close
on July 21.
BCA Sekuritas, BNI Sekuritas, Mandiri
Sekuritas are the underwriters for the
deal.
The bonds are rated AAA by Fitch
Indonesia.
for Facility A1 and B1, respectively.
A bank presentation will be held in
Singapore on August 5, with commitments due
on August 19. The signing of the syndicated
agreement is slated for the week of August 29.
Proceeds raised are for general corporate
purposes, including investments.
Pertamina Hulu Energi is the upstream
subholding entity for all of Pertamina’s
upstream businesses, including exploration,
and the production of oil and gas in
Indonesia and abroad, according to the
parent’s website.
Pertamina EP and Pertamina Hulu
Indonesia, which are also borrowers on the
loan alongside Pertamina Hulu Energi, sit
within the same subholding group.
Separately, parent Pertamina closed a
US$1.45bn-equivalent five-year club facility
in May with a dozen lenders.
CHIEN MI WONG
›MEDCO ENERGI PRICES THREE-TRANCHER
MEDCO ENERGI INTERNASIONAL has announced
the yields for a Rp3trn three-tranche
bond offering, according to a filing on the
Indonesia Stock Exchange.
The oil and gas explorer and producer
has announced yields of 7% for a Rp1.9trn
three-year tranche, 8.1% for a Rp521bn five-
year piece and 9% for a Rp586.3bn seven-
year portion.
The bonds will be allotted on July 22.
Pefindo has assigned a AA– rating to the
bonds.
Mandiri Sekuritas, DBS Vickers Sekuritas and
BRI Danareksa Sekuritas are the arrangers.
SYNDICATED LOANS
›PLN EYES DEBUT SLL
State-owned electric utility PERUSAHAAN LISTRIK
NEGARA has sent a request for proposals for
a financing of around US$750m, in what
could be the company’s first sustainability-
linked loan.
The borrower is considering tenors of up
to five years. The deadline for responses is
around the end of July.
In December 2020, PLN raised a US$500m
debut green loan that carries a guarantee
from the World Bank’s Multilateral
Investment Guarantee Agency to fund
renewable energy projects.
Citigroup, DBS Bank, JP Morgan,
KfW IPEX-Bank, Landesbank Baden-
Wuerttemberg, OCBC Bank, Standard
Chartered and Sumitomo Mitsui Banking
Corp were the lenders on that facility.
In December 2021, the borrower signed
a US$600m amortising long-term loan with
the Asian Development Bank to improve its
transmission lines, power grid automation,
and hazardous waste storage facilities.
The results-based loan carries a sovereign
guarantee from the Republic of Indonesia.
RESTRUCTURING
›S&P SET TO DEMOTE SSMS
Palm oil company SAWIT SUMBERMAS SARANA
faces a downgrade to selective default
when it completes the settlement of a
tender offer to buy back its US$300m 7.75%
January 2023 bond.
The tender, which ended on July 7, saw
SSMS offer to purchase for cash up to
US$270m of the bonds at US$900 for each
US$1,000 of the principal, plus accrued and
unpaid interest. The 2023s, which are the
company’s only outstanding offshore notes,
had been trading at a cash price of 68.125
30 International Financing Review Asia July 16 2022
on the day the tender began.
Investors holding US$259.725m of the
notes, representing 86.58% of the total
outstanding amount, had applied to sell
back when the tender closed. The issuer
has accepted the applications and all notes
accepted will be cancelled.
“We view this transaction as tantamount
to a distressed transaction and a default
because the creditors will receive less
than the full value they were originally
promised,” S&P said in a rating note
Wednesday, adding that it will lower
the rating to selective default when the
settlement is done.
The tender offer will be funded by a
Rp3.6trn (US$242m) eight-year Islamic
syndicated loan secured at end-June from
a group of Indonesian banks at 9% per
annum.
S&P said any upward rating for SSMS will
depend on an increase in the transparency
of the terms in the syndicated debt facility,
including the amortisation profile and main
covenants.
The company has said the tender is
aimed at improving its financial position,
and gives it the flexibility it needs to
expand its business.
UOB Kayhian was the dealer manager
for the tender, with Morrow Sodali as the
information tender and tabulation agent.
SSMS operates 23 palm oil estates, eight
oil mills and one kernel mill.
JAPAN
DEBT CAPITAL MARKETS
›MUFG PRINTS A TLAC
(A1/A–/A–) on
MITSUBISHI UFJ FINANCIAL GROUP
Monday priced a US$4.5bn four-part senior
unsecured TLAC-eligible SEC-registered
offering of fixed and floating-rate notes.
The US$1.4bn three-year non-call two
fixed notes priced at par for 4.788% at
a spread of Treasuries plus 170bp. The
US$1.25bn six-year non-call five piece
priced at par for 5.017% with a spread at
Treasuries plus 195bp while the US$1.5bn
11-year non-call 10 tranche priced at par for
5.133% at Treasuries plus 212.5bp. Initial
price guidance had been shown on the
three respective tranches at 190bp, 215bp
and 237.5bp.
The sole three-year non call two floater
was set at US$350m at SOFR plus 165bp.
The bank seems to have prioritised size
over pricing as final spreads came above
fair values estimated by credit analysts.
CreditSights saw fair value of the short-
dated tranche at 160bp, with the six-year
non-call five and the 11-year non-call 10
pieces at 195bp and 218bp, respectively.
The fair values had included new issue
premiums at 15bp–25bp.
Analysts from Nomura saw fair value
estimates at 160bp, 185bp and 205bp for
the respective tranches. They noted that
existing TLAC senior bonds from Japanese
mega-banks have widened significantly
year to date to high 4% from mid-2% at the
start of the year.
Settlement of all the notes is on July
20, with proceeds to fund the operations
of MUFG Bank and Mitsubishi Trust
and Banking Corporation through loans
intended to qualify as internal TLAC debt.
MUFG and Morgan Stanley were active
bookrunners.
MUFG has already come into the market
twice this year, having last bagged US$2bn
from a three-part bond deal in April.
›HEMSO SELLS ITS FIRST YEN BOND
HEMSO FASTIGHETS, a Swedish owner of public
use properties rated A– by S&P, has raised
¥10bn (US$73m) from its first yen bond
sale.
The 20-year bond was sold privately at
par with a 1.46% coupon on June 28.
“Hemso has been discussing yen
issuance with investors for quite some
time,” said Asa Thoft, the company’s head
of communications. “The timing of the
issuance is a result of those discussions.”
The issuer, which owns properties such
as nursing homes and schools, chose to
sell in this maturity segment as it has an
underlying demand for long-term funding
because of the nature of its assets with
long lease contracts. “The 20-year tenor
was competitive price-wise and also suited
our current redemption profile well,” said
Thoft.
The proceeds will be used to acquire
real estate assets in Sweden, Finland and
Germany, the countries where the issuer is
currently active.
Bank of America was sole lead.
Hemso is 85% owned by the Third
Swedish National Pension Fund and 15%
owned by Swedish commercial property
investor Sagax, directly and indirectly.
›JICA SELLS YEN PEACEBUILDING BONDS
JAPAN INTERNATIONAL COOPERATION AGENCY raised
an upsized ¥24bn from an offering of
two-tranche social bonds in the domestic
market on Friday.
The issuer plans to use the proceeds from
what it calls peacebuilding bonds mainly
for existing projects in conflict-affected

states, especially Iraq, the Philippines and
Turkey.
The theme attracted mid-sized
corporates, universities, social welfare
entities and a foreign asset management
firm, along with mega-banks, life insurers
and regional accounts.
The offering comprised a ¥11bn 0.374%
10-year tranche and a ¥13bn 0.91% 20-
year portion, both upsized from the
initially planned ¥10bn each because of
solid demand. The upsize is in contrast to
many other domestic deals where issuers
have slashed deal sizes amid volatility and
expectations for higher interest rates.
The state-owned agency started
marketing on Wednesday with initial
price guidance at 14bp over JGBs for the
10-year and 1.5bp over for the 20-year,
and continued marketing with the same
guidance on Thursday. Both tranches priced
at these spreads.
Daiwa, Tokai Tokyo, Nomura and Mizuho
were joint lead managers for the 10-year
tranche. Daiwa, Nomura, Mizuho, and
Okasan led the 20-year portion.
The issuer, rated A+/AA+ (S&P/R&I),
provides official development assistance in
the forms of technical cooperation, loans
and grants.
SYNDICATED LOANS
›INVINCIBLE INVESTMENT BAGS ¥50BN REFI
INVINCIBLE INVESTMENT CORPis raising two bullet
term loans totalling ¥50.284bn (US$363m)
for refinancing, the Tokyo Stock Exchange-
listed real estate investment trust said July
14.
Mizuho Bank was the arranger of a
¥49.684bn one-year syndicated loan, which
pays an interest margin of 25bp over one-
month Tibor.
Ogaki Kyoritsu Bank joined existing lenders
Citigroup, Development Bank of Japan, MUFG,
Resona Bank, Shinsei Bank, Sumitomo Mitsui
Banking Corp and Sumitomo Mitsui Trust Bank.
Meanwhile, Tokyo Star Bank is providing
a ¥600m three-year loan, which pays a
margin of 35bp over one-month Tibor.
Signing of the loans took place on the
same day.
Funding of the syndicated facility and
bilateral loan is slated for July 19 and 20,
respectively.
The borrower invests in hotels and
residential properties.
›WAKAYAMA GOBO AGREES ¥42BN LOAN
has signed
WAKAYAMA GOBO BIOMASS POWER PLANT
a ¥42.385bn loan for a 50MW biomass
power plant in Japan.
MUFG was the arranger of the loan,
which signed on June 30.
The borrower, established by JAG
Energy (35%), Osaka Gas (35%) and SMFL
Mirai Partners (30%), will use the funds to
build the plant in Gobo city, Wakayama
prefecture.
Commercial operations are scheduled to
begin in September 2025.
EQUITY CAPITAL MARKETS
›TOKYO INFRA SEALS FOLLOW-ON
TOKYO INFRASTRUCTURE ENERGY INVESTMENT has
priced a ¥6.05bn follow-on.
The closed-end fund, which invests
mainly in real estate assets, sold 64,900
units at ¥93,210 each.
The price represents a 2.5% discount to
Monday’s close of ¥95,600, from a discount
range of 2.5%–5%.
There is an overallotment option of 3,245
units.
Proceeds will be used for asset
acquisitions.
Mizuho and Nomura were the joint lead
managers.
MACAU
SYNDICATED LOANS
›SANDS CHINA GETS HELP FROM PARENT
Casino operator SANDS CHINA has
obtained a US$1bn unsecured six-
year term loan from its controlling
shareholder Las Vegas Sands Corp,
according to a Hong Kong stock
exchange filing July 11.
Proceeds are for working capital and
general corporate purposes.
In the first two years of the loan’s life,
Sands China will have the option to either
pay a cash interest of 5% per annum, or a
payment-in-kind interest of 6% per annum.
After two years, the borrower will only
have the former option available.
The loan is pre-payable in whole or in
part at any time without penalty.
Sands China’s obligations under the
loan will be subordinated to all third party
unsecured debt of the company, including
all of its senior notes and a US$2bn
syndicated revolving credit facility that was
first signed in 2018.
The latest loan highlights both Las Vegas
Sands and Sand China’s confidence in the
long-term growth potential of Macau, and
International Financing Review Asia July 16 2022 31
COUNTRY REPORT MALAYSIA
bolsters Sands China’s balance sheet and
liquidity position, the filing said.
Las Vegas Sands currently holds
approximately 70% of Sands China.
Macau shut down all its casinos for one
week on July 11 to contain a new outbreak
of the coronavirus.
MALAYSIA
DEBT CAPITAL MARKETS
›VS INDUSTRY SETS UP PROGRAMME
Electronics manufacturing services
provider VS INDUSTRY has established a M$1bn
(US$225.4m) Islamic MTN programme.
Wholly owned subsidiary VS Capital
Management will be the issuer of the notes,
which will be guaranteed by VS Industry.
The parent has no outstanding bonds.
The programme is rated AA by Marc to
reflect VS Industry’s healthy balance sheet,
strong liquidity profile and its solid market
position in the household electronics
industry. Proceeds will be used for working
capital needs, capital expenditure and debt
refinancing.
HSBC Amanah Malaysia is sole principal
adviser, lead arranger, lead manager and
sharia adviser for the programme.
›TH PLANTATIONS GROWS A PERPETUAL
TH PLANTATIONS has privately placed M$300m
of perpetual bonds priced at 5.98% with a
call at the end of year 12 (July 7 2034).
The notes settled on July 8, off a
newly established unrated Islamic MTN
programme of up to M$1.08bn. Under
the programme, special purpose vehicle
THP Suria Mekar will be the issuer of
senior and/or subordinated perpetual
sukuk under the wakala bi al-istithmar
format. Parent TH Plantations will be the
guarantor.
The Malaysian palm oil producer and
plantations owner had a M$300m 4.5%
bond due on July 8. TH Plantations is not
a frequent issuer, with the 2022s sold last
year representing its first issuance in five
years. The bulk of its outstanding bonds
of around M$980m were issued mainly in
2015 and 2016.
Proceeds will be used to fund or
refinance Islamic debt and to meet business
operations and working capital needs.
Maybank Investment Bank is principal
adviser and lead arranger for the
programme, and sole lead manager for the
deal.
›HENGYUAN REFINES PROGRAMME
HENGYUAN REFINING hasestablished a M$5bn
unrated MTN programme which it filed to
Securities Commission Malaysia.
AmInvestment Bank and Maybank Investment
Bank are joint financial advisers and lead
arrangers on the programme.
Refinitiv data show the Malaysian
petroleum products maker has no
outstanding bonds but has a US$430m bank
loan that will mature in January 2023.
EQUITY CAPITAL MARKETS
›ITMAX SYSTEM FILES FOR IPO
ITMAX SYSTEM has filed for a US$70m–$100m
Bursa Malaysia IPO.
Up to 320m shares will be sold
(129.4m secondary and 190.6m primary).
Institutions will be offered 289.2m shares
and retail 30.8m. Sena Holdings is the
vendor and its holding in the company will
fall to 51.3% from 78.4% after the IPO.
Itmax System, which provides lighting
systems and traffic management services,
will use the proceeds to fund its smart city
business expansion.
Revenue in 2021 was M$79.8m (US$18m),
up 68% from M$47.5m in 2020. Profit after
tax rose 130% to M$29.2m from M$12.7m.
CIMB and Maybank are the joint
bookrunners.
NEW ZEALAND
DEBT CAPITAL MARKETS
›ANZ TIER 1 NOTE NETS NZ$550M
ANZ BANK NEW ZEALAND (A1/AA–/A+) raised
NZ$550m (US$339m) in Additional Tier 1
capital, more than double the indicative
NZ$250m issue size, from a retail sale of
perpetual preference shares.
The notes pay an interest rate of 6.95%
until the first call date on July 18 2028 with
the margin set at the tight end of mid-
swaps plus 325bp–345bp guidance.
ANZ was the arranger and joint lead
manager with Craigs Investment Partners,
Forsyth Barr, Hobson Wealth Partners and
Jarden Securities for the subordinated notes,
rated BBB by S&P.
New Zealand banks have been set
the world’s highest regulatory capital
requirements by the country’s reserve bank
which increased the minimum capital ratio
requirement from 10.5% of risk-weighted
32 International Financing Review Asia July 16 2022
assets to 18% for the country’s four major
banks and 16% for non-majors over a seven-
year period from July 2022.
Minimum Tier 1 capital levels have
been raised from 8.5% to 16% and 14%,
respectively, for the majors and non-
majors, with the remainder to come from
Tier 2 capital at two percentage points in
both cases.
PAKISTAN
DEBT CAPITAL MARKETS
›PAKISTAN, IMF REACH STAFF-LEVEL PACT
The International Monetary Fund said
Thursday it had reached a staff-level
agreement with Pakistan that would
pave the way for the disbursement of
US$1.17bn, if approved by the IMF board,
and is considering adding funds to the
programme.
In a statement, the IMF said its staff
had reached agreement on policies
under a review of its Extended Fund
Facility programme that could bring total
disbursements under the program to about
US$4.2bn, if approved.
In order to meet higher financing
needs, the IMF board will also consider an
extension of the EFF until the end of June
2023, and an addition of nearly US$1bn
that would bring total access under the
programme to about US$7bn, it said.
“Pakistan is at a challenging economic
juncture,” Nathan Porter, who headed
the IMF team, said in a statement, citing
the difficult external environment and
domestic policies that fueled demand to
unsustainable levels.
“The resultant economic overheating led
to large fiscal and external deficits in FY22,
contributed to rising inflation, and eroded
reserve buffers,” he added.
Agreed policy priorities included
steadfast implementation of the fiscal
2023 budget, which aimed to reduce the
government’s large borrowing needs and
boost revenues by targeting higher income
taxpayers, while protecting development
spending, Porter said.
Pakistan also needed to catch up on
power sector reforms, engage in proactive
monetary policy to guide inflation to
more moderate levels and work to reduce
poverty.
The country’s finance minister told
broadcaster Geo earlier that the talks
with the IMF had concluded, and an
announcement was expected soon.
Pakistan entered the IMF programme
in 2019, but only half the funds have
been disbursed to date as Islamabad has
struggled to keep on track to meet targets.
(Reuters)
PHILIPPINES
DEBT CAPITAL MARKETS
›AC ENERGY TO FUND SOLAR FARMS
AC ENERGY, the energy unit of Ayala Group,
plans to raise up to Ps10bn (US$180m) from
five-year debut green fixed-rate bonds to
build solar farms, according to a filing on
the Philippine Stock Exchange.
The bonds will comply with the ASEAN
Green Bond Standards, which require the
proceeds to be used for the funding of
eligible green projects only.
The bonds are rated Aaa by PhilRatings
and will be issued out of a Ps30bn bond
shelf-registration programme to be
filed with the Securities and Exchange
Commission.
The proceeds will be used to expand
solar power projects – the 283-MWdc San
Marcelino solar farm in Zambales, 42-
MWdc expansion of the current 72-MWdc
Arayat-Mexico solar farm in Pampanga, and
construction of the 133-MWdc first phase of
the Cagayan solar farm.
AC Energy aims to become the largest
listed renewables provider in South-East
Asia. It is working to build 5,000 megawatts
of attributable renewable energy capacity
by 2025 from 3,400 megawatts currently.
›BOC PRICES BOND AHEAD OF BSP HIKE
BANK OF COMMERCE, a part of San Miguel
Group, priced its maiden peso bond at
5.0263% on Tuesday, two days before the
central bank of the Philippines announced
a surprise 75bp increase in interest rates.
The lender closed the two-year deal 10
days earlier than scheduled after receiving
overwhelming demand from institutional
and retail investors, according to a release.
Bank of Commerce, rated Aa+ by
PhilRatings, aims to raise Ps3bn but has yet
to disclose the final size of the deal.
On Thursday, the central bank raised
the overnight reverse repurchase facility
rate by 75bp to 3.25%. Bangko Sentral ng
Pilipina announced the move outside the
regular policy meeting cycle and kept the
door open to further tightening to stem
inflationary pressures and a faltering peso.
The yield on the two-year government

bond benchmark surged to 4.76%, the
highest level since July 2019, according to
Refinitiv data.
The central bank previously raised interest
rates by 25bp in May and again in June.
The proceeds from the bond will be used
to manage Bank of Commerce’s net interest
margin by matching long-term assets with
long-term funding to reduce interest rate
risk and diversify funding sources, it said in
a release.
The deal is the first under a Ps20bn bond
programme. ING Bank Manila branch and
Philippine Commercial Capital are joint lead
arrangers and joint bookrunners along with
Bank of Commerce as the selling agent.
SINGAPORE
DEBT CAPITAL MARKETS
›OLAM, INCOME CALL SUB BONDS
OLAM GROUP has redeemed a S$350m
(US$248.9m) 5.5% perpetual bond on the
first call date of July 11, while NTUC INCOME
INSURANCE CO-OPERATIVE will exercise the first
call on its S$600m 3.65% Tier 2 in late
August in moves that will ease concerns
over non-call risk in Singapore dollar
subordinated bonds.
Singapore-listed Olam said it had
redeemed in full the perpetual bond that
was sold in August 2017.
At the same time, Singaporean insurance
company NTUC Income said the 3.65% Tier
2 2027 notes, issued in 2012, are due to
be called on August 23. It said in an SGX
statement on July 12 that it plans to redeem
the bond in whole on that date.
The redemptions follow Singaporean
telecoms provider StarHub’s decision not
to redeem its S$200m 3.95% perpetual
notes on the first call date on June 16
on economic grounds. The decision had
revived investor concerns that more
issuers might not redeem their existing
subordinated bonds on the call dates.
SYNDICATED LOANS
›FRASERS L&C LANDS £44.5M BILATERAL
Frasers Logistics & Commercial Trust has
obtained a letter of guarantee facility of
up to £44.5m (US$53m) from DBS Bank,
according to an exchange filing on July 12.
PERPETUAL (ASIA), in its capacity as trustee of
Frasers Logistics & Commercial Trust, is the
borrower.
Under the terms of the facility
agreement, the loan will be cancelled
if Frasers Logistics & Commercial Asset
Management resigns or is removed as a
manager of the trust and is not replaced
by a substitute approved by the Monetary
Authority of Singapore.
A cancellation could also occur if Frasers
Property ceases to hold more than 50% of
the issued share capital of the manager.
A cancellation event could trigger cross-
defaults on other borrowings for Frasers
Logistics & Commercial Trust, which were
at approximately S$1.95bn (US$1.39bn) as
of July 12.
In June last year, Frasers Logistics &
Commercial Trust obtained sustainability-
linked loans of up to A$85m from United
Overseas Bank.
SOUTH KOREA
SYNDICATED LOANS
›SHINHAN RETURNS FOR US$300M SLL
SHINHAN BANK has launched a US$300m five-
year sustainability-linked loan into general
syndication, returning to the markets after
four years.
Mizuho Bank is the mandated lead
arranger and bookrunner of the term loan,
which offers an interest margin of 89bp
over three-month term SOFR.
Including a 5bp early-bird fee, MLAs
committing US$50m or more will receive
a top-level all-in pricing of 95bp via a
participation fee of 25bp, while lead
arrangers with US$30m–$49m earn an
all-in of 93bp via a 15bp fee.
Early-bird commitments are due by
August 5, while the final deadline is August
19.
The margin will decline by 5bp if
the sustainability performance of the
borrower’s parent, Shinhan Financial
Group, improves.
The improvement will be based on its
environmental, social and governance score
with the exact methodology to be discussed
and agreed.
The SLL’s proceeds will be used for
working capital purposes.
In July 2018, the borrower raised a
US$300m triple-tranche facility from seven
banks, including MUFG as MLAB.
That loan offered top-level all-in pricings
of 45bp, 71bp and 81bp for the one, three
and five-year tenors, respectively, based on
margins of 35bp, 60bp and 73bp.
Shinhan Bank is rated Aa3/A+/A.
International Financing Review Asia July 16 2022 33
COUNTRY REPORT SOUTH KOREA
›KOOKMIN BANK ATTRACTS A DOZEN
South Korea’s largest bank KOOKMIN BANK has
closed its first syndicated loan in almost
five years at US$650m after attracting a
dozen Asian banks in general syndication.
Bookook Securities was the arranger of the
borrowing and ended up with zero final hold
after nine Taiwanese banks, two Chinese
lenders and State Bank of India joined.
The borrowing was launched at a base
size of US$500m and a greenshoe of
US$300m.
Lenders were offered a top-level all-in
pricing of 95bp based on an interest margin
of 94bp over three-month term SOFR.
Proceeds are for general corporate
purposes.
In November 2017, Kookmin Bank raised
a US$400m term loan, which comprises a
US$60m three-year tranche, a US$60m five-
year piece and a US$280m two-year portion.
Mizuho Bank was the mandated
lead arranger and bookrunner of that
borrowing, while Bank of China, Bank
of Taiwan, China Construction Bank,
Citigroup, First Abu Dhabi Bank and Mega
International Commercial Bank joined as
MLAs, according to Refinitiv LPC data.
Kookmin Bank is rated Aa3/A+/A.
For full allocations, see www.ifre.com.
EQUITY CAPITAL MARKETS
›HPSP SURGES ON DEBUT
HPSP’s shares closed up 73% on their
trading debut on Friday, following the
semiconductor equipment maker’s W75bn
(US$56.7m) KRX IPO.
The stock opened at W50,000, double
the issue price of W25,000 and closed at
W43,250.
NH Investment and Securities led the float.
›LUNIT PRICES IPO BELOW RANGE
AI-based cancer screening developer LUNIT
has priced its IPO below the W44,000–
W49,000 range to raise W36.5bn.
The deal, comprising 1.2m primary
shares, or 11.6% of the enlarged share
capital, was priced at W30,000, 31.8% below
the bottom of the indicative price range.
There is a voluntary lock-up of between
15 days and six months.
Lunit is selling 69.46% of the shares to
institutional investors, 25% to retail and
5.54% to an employee stock ownership plan.
Founded in 2013, Lunit mainly provides
AI solutions for cancer diagnostics and
therapeutics to help discover cancers and
predict treatment.
NH Investment & Securities led the float.
›SUNGEEL HITECH PRICES ABOVE RANGE
Battery recycling manufacturer SUNGEEL
HITECH has priced its IPO above the indicative
price range to raise W133.5bn.
The deal was priced at W50,000, 5.3%
above the top end of the indicative price
range of W40,700–W47,500.
Strong investor demand led to the
decision to price above range, people
familiar with the matter said.
A total of 255 international investors and
1,531 local institutional investors placed
orders for a combined 3.3bn shares, or
2,269 times the about 1.5m shares on offer
in the institutional tranche. Practically all
(1,714) indicated a willingness to buy shares
above the marketed range.
Bankers set aside 55% of the deal to the
institutional tranche, 25% to retail and 20%
to an employee stock ownership plan.
The deal comprises 2.67m primary
shares, or 22.5% of the enlarged share
Taiwan’s largest wind farm PF launches
„ Loans Proceeds back the construction of the Hai Long wind farm project
Canadian power producer NORTHLAND POWER
has launched a NT$153.14bn (US$5.12bn)
financing into general syndication, in what
will be the largest and longest-dated loan for
Taiwan’s offshore wind projects.
Cathay United Bank and MUFG are the
financial advisers on the loan, which has a
tenor of around 22 years and comprises a
NT$130bn base tranche and a NT$23.14bn
ancillary portion.
The base tranche is expected to split into
an export credit agency facility, an NT dollar-
denominated commercial piece and an
euro-denominated commercial portion. The
amount for each sub-tranche is not finalised
yet.
The ECA facility will carry insurance cover
from Export Development Canada, Export
Finance Australia, Denmark’s EKF, Japan
Bank for International Cooperation and
Nippon Export & Investment Insurance.
The NT$23.14bn ancillary tranche
comprises a standby facility of NT$6bn,
bond facilities totalling NT$9.74bn, a
value-added tax facility of NT$400m and a
pre-completion revenue facility of NT$7bn.
The NT dollar commercial portion of the
base tranche pays an interest margin of
255bp over Taibor during the construction
period and will step down to 230bp after
commencement of operations.
The euro portion offers a margin of 165bp
over Euribor for the construction period and
will decrease to 140bp thereafter.
34 International Financing Review Asia July 16 2022
capital and there is a voluntary lock-up of
between 15 days and six months.
The retail subscription will run from July
18 to 19.
Daishin Securities and KB Securities led the
float.
TAIWAN
SYNDICATED LOANS
›VEDAN PAYS TIGHTER PRICING ON RETURN
Food and beverage company VEDAN ENTERPRISE
has launched a NT$4.5bn (US$151m) seven-
year loan linked to environmental, social
and governance metrics, paying tighter
pricing than the 2017 borrowing that it is
refinancing.
The ECA-covered tranche offers a margin
of 120bp–130bp over Taibor during the
construction period and will step down to
100bp–110bp during the operational phase.
MLABs joining with commitments of
NT$7.1bn or more will receive top-level
upfront fees of 125bp and 165bp for the ECA
and commercial tranches, respectively.
MLAs taking NT$5.5bn–$7bn earn fees of
110bp and 150bp for the ECA and commercial
tranches respectively, while lead arrangers
with NT$3.5bn–$5.4bn receive fees of 95bp
and 135bp.
Arrangers with NT$2bn–$3.4bn earn fees
of 75bp and 105bp, while participants with
less than NT$2bn receive fees of 30bp and
50bp.
The deadline for responses is August 19.
Proceeds are to back the construction
of the Hai Long wind farm project, which
comprises Hai Long 2A (300MW), Hai Long
2B (232MW) and Hai Long 3 (512MW).
The wind farms are located off the coast of
Changhua county and slated to commence
operations from late-2025 to end-2026.
Hai Long 2A signed a 20-year power
purchase agreement with state-owned
Taiwan Power under a tiered feed-in tariff
scheme that sets a higher price in the first
decade before being lowered in the second
decade.
Hai Long 2B and Hai Long 3, which are
not eligible for the favourable FIT rates,
signed a separate 20-year PPA with a private
Land Bank of Taiwan is the mandated lead
arranger and bookrunner of the latest
secured loan, which comprises a NT$4.5bn
term loan tranche A and a NT$1bn
guarantee tranche B. The two tranches
cannot exceed NT$4.5bn combined.
Tranche A pays an interest margin of
68bp over the one-year savings rates of
Bank of Taiwan, Chang Hwa Commercial
Bank, First Commercial Bank, Hua Nan
Commercial Bank, LBOT and Taiwan
Cooperative Commercial Bank, with a pre-
tax interest rate floor of 1.7%.
Tranche B offers an annual guarantee fee
of 50bp.
The margin will be reduced by 1bp if
the borrower achieves one of the five ESG
metrics, and by up to 3bp for meeting three
metrics or more.
The targets the borrower needs to
meet include reducing its electricity
consumption, water usage and carbon
emissions, as well as achieving a water
sector corporate on July 11. The offtaker is an
investment-grade counterparty with a AA−
rating, Northland Power said.
Northland Power holds a 60% stake in Hai
Long Wind Farm, while Yushan Energy owns
the remainder.
Yushan Energy is an offshore wind energy
developer based in Taiwan and counts
Singapore’s Yushan Energy and Japan’s
Mitsui & Co as its joint shareholders.
Hai Long plans to work with partners
Siemens Gamesa Renewable Energy and
CSBC-DEME Wind Engineering on the
project.
At NT$153bn, the size of the debt will
surpass the current holder of the record
for the largest offshore wind farm loan
from Taiwan – a NT$90bn 18-year PF for a
600MW wind farm in Changfang and Xidao
with Danish infrastructure fund management
company Copenhagen Infrastructure
Partners as sponsor.
CTBC and MUFG were the financial
advisers of that borrowing, which was
closed in January 2020 with six export credit
agencies, and 25 local and international
lenders joining.
The tenor of around 22 years on the latest
PF is also longer than that a NT$75bn 20-
year loan for Danish wind energy developer
Orsted raised in December 2020 and a
NT$45.205bn 20-year facility for China Steel
and CIP completed in November 2021.
AILEEN CHUANG

recycling rate of 70% or above in its
manufacturing processes and making
charity donations of NT$5m or more.
MLAs joining with NT$800m or more
will receive an upfront fee of 12bp,
while managers with NT$500m–$799m
earn a 6bp fee. Participants committing
NT$300m–$499m are offered a 4bp fee.
Responses are due by August 12.
Proceeds are to refinance a NT$4bn
seven-year loan raised in June 2017 and for
working capital purposes.
The borrower’s land and factory serve as
security, while chairman Yang Tou-xiong is
providing a personal guarantee.
The 2017 term loan comprises a
NT$2.4bn secured tranche A and a
NT$1.6bn unsecured tranche B.
Tranches A and B pay margins of 71bp
and 75bp, respectively, over the same
benchmark as the latest borrowing and
have pre-tax interest rate floors of 1.7%,
according to Refinitiv LPC data.
›REVIVEGEN MAKES DEBUT
Revivegen Environmental Technology has
launched a debut NT$3.032bn seven-year
facility into general syndication.
Taiwan Cooperative Bank is the mandated
lead arranger and bookrunner of
the loan that backs the construction
of a petrochemical oil storage and
transportation centre in the Port of
Kaohsiung.
The facility comprises a NT$1.5bn
term loan tranche A for the first phase
of construction, a NT$1.5bn term loan
tranche B for the second phase of
construction and a NT$32m guarantee
tranche C.
The interest margin is 155bp over the
one-year post office savings rate during
the construction period, with an after-tax
interest rate floor of 2.4%. It will step down
to 95bp over the same benchmark after the
centre begins operation, with the interest
rate floor set at 2.2%.
During the operational period, the
margin will narrow by 1bp if the borrower
meets one of the three environmental,
social and governance metrics and by up to
3bp for meeting all criteria.
The metrics are related to the borrower’s
waste and industrial water recycling rates,
as well as its green energy power ratio.
The margin can narrow further by
5bp if the petrochemical oil storage and
transportation centre reaches a 90% or
more occupancy rate.
The loan carries an after-tax interest
rate floor of 2.1% even with the margin
reductions.
Lenders are being invited to join with
commitments of NT$450m or above for
an upfront fee of 23bp, or with NT$300m–
$449m for a 13bp fee.
Those responding before August 12 will
receive an early-bird fee of 2bp. The final
deadline for commitments is August 19.
STOLTHAVEN REVIVEGEN KAOHSIUNG is the
borrower, while majority shareholder
Revivegen is the guarantor.
Stolthaven Terminals, a Netherlands-
based company holding a minority stake in
the borrower, has provided a standby letter
of credit.
The centre’s first phase of construction is
expected to be completed in mid-2023 and
the second phase a year later.
EQUITY CAPITAL MARKETS
›DUO LINE UP GDR OFFERS
The planned global depositary receipt
offerings of WIWYNN and POWERCHIP
SEMICONDUCTOR MANUFACTURING are moving
closer, with both companies clearing
regulatory procedures for their share sales.
Wiwynn, which produces servers for
cloud services and data centres, was cleared
on June 27 for its plan to sell up to 17m
shares. The offer could raise US$383m
based on Monday’s closing price of NT$672.
Powerchip Semiconductor
Manufacturing’s application was approved
on Wednesday. It is planning to sell up
to 350m shares and could raise US$470m
based on Monday’s closing price of
NT$40.10. The company plans to use the
proceeds for business development and the
purchase of machinery.
On June 30, Taiwan’s Chailease Holding
raised US$388m from a GDR offering via
Morgan Stanley.
THAILAND
DEBT CAPITAL MARKETS
›MTC RETURNS FOR TWOS AND THREES
MUANGTHAI CAPITAL, rated BBB+ by Tris,
will offer two and three-year bonds for a
targeted Bt7.5bn (US$205m) in its seventh
fundraising of the year to lock in current
rates.
The two-year tranche is priced at 3.5%
and the three-year tranche at 3.8%. All
the notes, also rated BBB+ by Tris, will be
offered to retail and institutional investors
during subscription from August 19–22.
Bangkok Bank, CIMB Thai Bank, Krungthai
Bank, Kasikornbank and Yuanta Securities
International Financing Review Asia July 16 2022 35
COUNTRY REPORT THAILAND
Thailand are joint lead managers.
Proceeds will be used to repay Bt5.43bn
of bonds that will mature in July and
November as well as to fund general
business needs.
The Thai auto and personal finance
company raised close to Bt16bn in six
previous issuances this year.
›GULF ENERGY FUELS JUMBO BOND
GULF ENERGY DEVELOPMENT, rated A by Tris, will
hold two separate bond offerings in tenors
of three to 10 years to raise up to Bt35bn.
It plans to open books on three, five and
10-year tranches on July 21 that will be
marketed only to institutional and high-net-
worth investors. Subscription to the triple-
tranche sale will be on August 2 to finalise
sizes of the tranches for a targeted total
minimum size of Bt10bn.
The second bond sale will be to the
public comprising retail, institutional
and general cooperative investors. Four
tranches in tenors of four and seven years
will be on offer, including two tranches
to be sold as digital bonds via Krungthai
Bank’s “pao tang” mobile application.
Pricing of the public tranches will
be fixed around the same time as the
institutional tranches, ahead of subscription
slated for August 15–17. No size has been
indicated for the public offering, but the
combined public and institutional tranches
are targeted at Bt35bn.
All the bonds are rated A– by Tris to
reflect the subordination of the senior
unsecured bonds to secured debt. Tris
said Gulf has a consolidated debt of
Bt234bn at end-March, of which Bt142bn
was considered priority debt comprising
secured debt and debt incurred by
operating subsidiaries.
The utility plans to use the proceeds for
business expansion plans, to repay loan
facilities and fund working capital needs.
Bangkok Bank, Bank of Ayudhya, CIMB Thai
Bank, Kasikornbank, Kiatnakin Phatra Securities,
Maybank Securities Thailand, Siam Commercial
Bank, TMB Thanachart Bank and United
Overseas Bank are joint lead managers for
both the institutional and public offerings.
›BAY MARKETS T2 NOTES
BANK OF AYUDHYA, locally rated AAA by Fitch,
will offer baht-denominated 10-year bonds
at 3.9% to institutional and high-net-worth
investors this week.
The subordinated notes, locally rated AA
by Fitch, will qualify as Tier 2 capital.
The Thai bank did not indicate the issue
size but proceeds are likely to be used to
fund the redemption of an outstanding
Bt17bn 3.9% Tier 2 bond with a call on
August 24 that Bank of Ayudhya has said it
will exercise.
Subscription will run from July 21–26 via
sole lead manager Bank of Ayudhya.
EQUITY CAPITAL MARKETS
›FOREIGNERS BUY 40% OF THAI LIFE IPO
Foreigners have bought 40% of THAI LIFE
INSURANCE’s Bt34.5bn (US$957m) IPO,
Thai issuers rush to beat hike
„ Bonds Central bank expected to lift policy rate for first time in over three years
Thai corporates are making a beeline for
the local bond markets ahead of a widely
expected benchmark rate increase at the
Bank of Thailand’s August 10 meeting.
Bankers are projecting Bt120bn (US$3.3bn)
of corporate bonds, excluding debt from
state-owned enterprises, will be priced before
then and issued by the end of August if all the
plans come to fruition, giving a massive boost
to issuance volume for 2022. The Thai Bond
Market Association is expecting this year’s
volume to top Bt1.2trn, surpassing last year’s
record of Bt1.03trn.
“Based on the issuers’ current funding
plans, it is going to be a record issuance for
the month of August as the companies are
squeezing their issues to price in July and
issue in August,” said one Thai DCM banker.
Thailand has yet to tighten monetary policy
in this cycle, but this looks set to change. At
its last meeting in June, the central bank said
that inflationary pressures were building and
hinted rate adjustments would be required in
response.
Inflation hit a near 14-year high in June,
with the consumer price index rising 7.7%
from a year earlier, reinforcing expectations
for a rate increase.
Economists are anticipating small
increases of 25bp each at the next two
monetary policy meetings in August and
September, particularly in view of the BoT’s
position that it will aim to gradually raise
rates without stalling the fragile economic
recovery.
The rate rise would be the first since
December 2018 and would lift the policy rate
off a record low 0.5%.
The higher-than-expected jump of 1.3%
in US consumer prices in June against an
expected 1.1% may add urgency to the BoT’s
hawkish tilt, as global markets have priced
in a hike of 75bp, or possibly even more, at
the next Federal Open Market Committee
36 International Financing Review Asia July 16 2022
Thailand’s largest this year, said people
with knowledge of the matter.
Overall 100 accounts participated in the
IPO.
The float, comprising 2.16bn shares
(850m primary/1.31bn secondary) or
18.8% of the capital, was marketed and
priced at a fixed price of Bt16. Existing
shareholders VC Property and Her Sing
(HK) are the vendors of the secondary
shares. There is a greenshoe of 161.6m
shares.
meeting on July 26–27.
“Every issuer wants to push out as they
expect yields to spike immediately after the
FOMC meeting, and definitely before the MPC
meets in August,” said another Thai banker.
The recent fall in Thai government bond
yields, used as benchmark rates for corporate
bond issues, is another incentive to rush to
market. The five-year TGB yield was quoted at
2.29% and the 10-year yield at 2.61% on July
11, down from respective yields of 2.43% and
2.99% on June 7.
The spike in supply will be easily
accommodated by ample liquidity in the
institutional and retail investor markets.
Investors are still pursuing high-yielding
investments in the record-low rate
environment and have turned to fixed income,
away from the more volatile equity markets,
for more stable earnings.
Refinitiv data showed that close to
Bt702bn of bonds were sold in the first half,
a 30% jump from Bt539bn in the first six
months of last year.
One of the largest issuers in August will
be utility GULF ENERGY DEVELOPMENT, which
plans to print up to Bt35bn in two separate
offerings, one as a public sale and another
to institutional investors and high-net-worth
investors. It plans to hold bookbuilding on the
institutional portion of three to 10 years on
July 21 for a targeted Bt10bn. Subscription for
the retail portion will take place from August
15–17.
Thai conglomerate Charoen Pokphand
Group will be well represented by three
subsidiaries in August, with integrated
telecoms operator TRUE seeking to raise
Bt17bn, retail supermarket chain owner CP ALL
planning a Bt19bn public offering, and agro-
industrial and livestock company CHAROEN
POKPHAND FOODS rumoured to be seeking over
Bt6bn.
KIT YIN BOEY
Books for both the domestic institutional
and international institutional tranches
were heavily oversubscribed.
The shares will start trading on the Stock
Exchange of Thailand on July 25.
Proceeds from the IPO will be used for
digital transformation and marketing and
to strengthen capital.
Bank of America, Citigroup, Kiatnakin
Phatra and Nomura are the joint global
coordinators and bookrunners with CIMB,
Macquarie, Finansa and Krungsri Securities.
VIETNAM
EQUITY CAPITAL MARKETS
›VINFAST HIRES BANKS FOR FUNDING
Carmaker VINFAST TRADING AND INVESTMENT
has appointed Citigroup and Credit Suisse
to help raise at least US$2bn each
through debt or equity in the offshore
markets.
Each agreement “could include debt
or private placements of equity,” it said
without giving details. The funds will be
used to build its planned electric vehicle
factory in North Carolina and fund its US
expansion.
VinFast’s fundraising announcement
comes as its planned US$2bn–$3bn US
IPO has been delayed to next year
because of unfavourable stockmarket
conditions.
In April the company confidentially
submitted a draft registration statement
to the US Securities and Exchange
Commission and was aiming to launch the
deal this year.
The IPO would be the first by a
Vietnamese company in the US.
Citigroup, Credit Suisse and Morgan Stanley
are working on the IPO.
VinFast produces electric cars,
motorbikes and buses. The electric vehicle
factory is expected to become operational
in 2024.
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THE SYNDICATE
A PODCAST FROM IFR

IFR’s podcast series looks back at some of the

biggest – and most ground-breaking – deals in
capital markets history

The Syndicate begins with Google’s 2004 initial public offering, a deal that
tried – and failed – to revolutionise the way companies go public.

Other episodes cover the first Eurobond from 1963, the disastrous sale of
BP shares in 1987, the securitisation of David Bowie’s back catalogue in
the late nineties, the first swap between the World Bank and IBM, as well
as the first-ever green bond.

Relive the drama, the tension and the wider legacy of each deal through
the people that made them happen.

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