similar deals before entering
them on the platform.
The new electronic bidding
rules aim to bring more
transparency and increase
price discovery, but “there
will still be some amount
of underwriting; banks
with large prop books will
continue to cut cheques, and
complete transformation of the
market will take time,” said a
second source from a private
sector non-banking financial
company.
RULE CHANGES
Indian issuers have won some
relaxations of the new rules.
After a hasty change to rules
that were only introduced on
April 1, issuers will now get
their money on the day of
allotment, rather than waiting
for a day for the exchanges to
clear and settle the funds.
Under the amended rules,
investors who successfully
bid for bonds are required to
transfer the funds from bank
accounts registered with the
EBP to the designated account
no later than 10:30am on T+1,
or one day after bidding. That
puts the onus on investors to
complete their transfers sooner.
“There will be no loss of one
day’s interest as the issuers will
get the money on the same
day as the investors pay,” said a
DCM banker.
CAR steers through two markets
Bonds Surprise RRR cut opens window for renminbi issuersBY INA ZHOUChinese car rental company
CAR INC tapped both the Panda
bond market and Dim Sum
bonds market last week,
raising a combined Rmb1.08bn
(US$171m).
The Hong Kong-listed
company, AA+ rated by
Shanghai Brilliance, returned
to the Panda bond market
last Monday after onshore
yields came down significantly
following an unexpected cut to
the reserve requirement ratio
on April 16.
It priced the three-year
non-put two Panda bonds last
Monday in the Shanghai Stock
Exchange at par to yield 6.30%.
The next day, the issuer,
rated Ba3/BB (Moody’s/S&P),reopened its Rmb400m
(US$63.3m) 6.50% three-year
non-call two Dim Sum notes
for Rmb350m in the offshore
market. The tap priced at 99.25,
or a yield of 6.784%.
Meanwhile the Dim Sum
bond market has remained
favourable to CAR, which
launched a debut 6.50% Dim
Sum bond on March 26.
A source familiar with the
matter said that the tap offered
Dim Sum investors a pick-up of
75 cents. The notes were traded
at par in the secondary market
before the tap was announced
and the tap was finally priced
at 99.25.
The Rmb350m tap on the
6.50% Dim Sum bonds drew
orders of over Rmb650m from
21 accounts. Fund managerswere allocated 78% of the notes,
banks and insurance firms 20%,
with private banks 2%.
Stats for the Panda bond
offering were not available.
Proceeds from the Panda
bond offering were restricted
for onshore use, while the
proceeds from the Dim
Sum bonds go towards debt
repayment and business
development.
CAR’s debut Panda bond
came in April 2017, when it
raised Rmb300m from five-year
non-put three notes priced at
par to yield 5.50%.
CICC was sole lead on the
new Panda bond. CICC and
Standard Chartered are joint
global coordinators, joint lead
managers and joint bookrunners
on the Dim Sum tap. For daily news stories
visit http://www.ifrasia.comDOOSAN MACHINE TOOLS , owned
by private equity firm MBK
Partners, is also mulling a
US$800m listing on the Korea
Exchange in the second half
of the year. The company is
a manufacturer of turning
centres, machining centres
and other precision machine
tools.
SK Lubricants was supposed
to use the IPO proceeds for
capital expenditure and general
working capital.
Korea Investment & Securities
and Samsung Securities were the
domestic leads for the IPO,
while Citigroup and Credit Suisse
were the international leads.
Mirae Asset Daewoo was also a
joint bookrunner.
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