IFR Asia – May 05, 2018

COUNTRY REPORT CHINA

First Seafront Fund Management is sole
arranger on the plan.
Last month, the China Securities
Regulatory Commission said that it would
encourage companies to conduct rental
housing asset-backed securitisations.
A “green channel” will be set up to speed
up the issuance of such securities, CSRC said.

SYNDICATED LOANS

› GREENTOWN SEEKS US$630M LOAN

Chinese property developer GREENTOWN CHINA
HOLDINGS is in the market for a US$630m-
equivalent three-year loan.
HSBC is the mandated lead arranger and
bookrunner of the transaction, which can
be drawn in Hong Kong or US dollars.
The deal offers an interest margin
of 256.5bp over Hibor/Libor and has an
average life of 2.7 years.
MLAs committing US$50m-equivalent
or more will receive an all-in pricing of
312bp via an upfront fee of 150bp, while
lead arrangers joining with US$30m–$49m-
equivalent earn an all-in pricing of 301bp
via a 120bp fee. Responses are due on May
30.
Funds are for capital expenditure,
refinancing and working capital purposes.
State-owned China Communications
Construction Group, which owns a 28.83%
stake in Greentown, is providing a letter of
comfort.
The Hong Kong-listed borrower last
tapped the market in March 2016 with a
US$720m three-year bullet loan. HSBC was
also the MLAB on that deal, which offered a

margin of 313bp over Libor and a top-level

upfront fee of 200bp.

Greentown is one of China’s major

property developers, with a primary

focus in Zhejiang province and its capital

Hangzhou.

› MANGANESE MINER DRILLS FOR REFI

CITIC Dameng Holdings has launched

a US$100m three-year loan into limited

syndication.

DBS is the mandated lead arranger and

bookrunner of the transaction, which offers

an interest margin of 230bp over Libor.

Funds are for refinancing and general

corporate purposes.

Repayment takes place after a one-year

grace period in three annual instalments of

10%, 10% and 80%.

CITIC DAMENG INVESTMENTS, a wholly owned

unit of CITIC Dameng Holdings, is the

borrower, while the parent is the guarantor.

CITIC Group has a 9% stake in CITIC

Dameng Holdings, while CITIC Resources

Holdings holds 34%.

Hong Kong-listed CITIC Dameng Holdings

mines manganese and has downstream

processing operations in China and Gabon.

› AVIC ON RUNWAY

AVIC INTERNATIONAL LEASING is tapping offshore

markets for a US$200m three-year loan.

China Construction Bank (Asia) and First Abu

Dhabi Bank are the mandated lead arrangers

and bookrunners of the bullet deal, which

offers an interest margin of 150bp over

Libor.

MLAs committing US$30m or more will

receive an all-in pricing of 165bp via an

upfront fee of 45bp, while lead arrangers

joining with US$20m–$29m earn an all-in

pricing of 162bp via a 36bp fee. Arrangers

coming in for US$10m–$19m will receive

an all-in pricing of 159bp via a 27bp fee.

Funds are for capital expenditure and

general corporate purposes. Responses are

due on June 4.

The borrower is China Aviation

International Holdings, while AVIC

International Leasing is the guarantor.

Last November, AVIC International

Leasing raised a Rmb1bn (US$158m) three-

year senior loan. Bank of China was the

MLAB on that deal, which offers a margin

at par with the PBoC rate.

› BOCOM MACAU RAISES STAKES

BANK OF COMMUNICATIONS MACAU has increased a

loan to US$350m from a US$300m target.

HSBC was the mandated lead arranger

and bookrunner of the transaction, which

comprises a US$250m 364-day tranche A

and a US$100m two-year tranche B. The

interest margins are 60bp and 71bp over

Libor for tranches A and B, respectively.

Lenders joining as MLABs were offered

a top-level all-in pricing of 73bp or 81bp

via participation fees of 13bp or 20bp for

tranches A and B, respectively.

Funds are for working capital purposes.

Separately, BOCOM International Holdings

is in the market for a HK$4bn (US$510m)

three-year term loan. Bank of China (Hong

Kong), Bank of Communications Hong Kong

branch, HSBC and Standard Chartered are

the MLABs of that transaction, which can be

drawn in either HK or US dollars. Based on a

ZTE debt in focus after share suspension

„ Loans: Telecoms equipment maker grapples with US trade ban

Lenders on a US$450m loan maturing in July

for Chinese telecoms equipment group ZTE

face an event of default after the suspension

of the company’s shares on the Hong Kong

and Shenzhen stock exchanges.

ZTE’s shares on the two bourses were

suspended on April 17 following US sanctions

against the company.

Under the terms of the four-year bullet

loan, signed in July 2014, a suspension

of ZTE’s shares on the Hong Kong stock

exchange for more than 14 trading days

constitutes an event of default.

To alleviate concerns among lenders,

facility agent Bank of China (Hong Kong) has

notified them that ZTE, the guarantor of the

borrowing, has enough cash to repay the loan

on maturity or earlier, if the need arises.

ZTE did not immediately respond to

requests for comment.

ZTE was in discussions with relationship

banks to refinance the loan in March. At the

time, it also announced its intention to seek

medium or long-term debt for ZTE (HK), its

wholly owned subsidiary and the borrower on

the loan.

According to the March 15

announcement, ZTE was to provide a

guarantee for its unit’s debts for an amount

up to US$600m and for maturities of up

to 66 months, in order to secure debt

financing at favourable costs.

The US$450m facility paid a top-level

all-in pricing of 265bp via an interest margin

of 225bp over Libor and an upfront fee of

160bp. BOCHK, Credit Agricole, BNP Paribas

and Societe Generale were the mandated

lead arrangers and bookrunners of the

maturing loan, which attracted eight other

lenders in general syndication.

On April 16, the US Department of

Commerce banned American firms from

selling parts and software to ZTE for seven

years, saying the company had violated an

agreement on punishing employees that

was reached after it was caught illegally

shipping US goods to Iran.

EVELYNN LIN, YAN JIANG