It also sold HK$1.2bn (US$153m) of two-year
Hong Kong dollar bonds at par to yield 3.15%, the
TIGHTûENDûOFûlNALûGUIDANCEûOFûn ûANDû
35bp tighter than initial 3.50% area guidance.
The bonds will be issued off a US$3bn
medium-term note programme and
guaranteed by Sinopec Group. The notes
have expected ratings of A1/A+
(Moody’s/S&P), in line with the guarantor.
Proceeds will be used for general
corporate purposes.
4HEû$IMû3UMûTRANCHEûDREWûlNALûORDERSûINû
excess of Rmb1.3bn from more than 40
accounts. Of the notes, 92% went to Asia and
8% to Europe. By investor type, 45% went to
banks, 52% went to fund managers and
insurance, and 3% to private banks.
The Hong Kong dollar tranche attracted
lNALûORDERSûOFûMOREûTHANû(+BNûFROMûû
accounts. Of the notes, 97% went to Asia and
3% to Europe. By investor type, 34% went to
banks, 63% went to fund managers and
insurance, and 3% to private banks.
DBS Bank and HSBC were joint global
coordinators, joint bookrunners and joint
lead managers.JJRCB NEEDS MORE TIME FOR AT1 ISSUEJILIN JIUTAI RURAL COMMERCIAL BANK said it needs
more time to prepare an offering of up to
Rmb5bn (US$720m) of Additional Tier 1
securities in the offshore market.
The Hong Kong-listed Chinese lender will
seek shareholder approval to extend the
validity period of the authorisation for the
issuance plan by 12 months, according to a
STOCKûEXCHANGEûlLINGûLATEûONû-ONDAY
4HEûBANKûlRSTûDISCLOSEDûTHEûPLANûTOûISSUEû
offshore preference shares in August 2017
and obtained the authorisation from
shareholders on November 8 2017.
It did not disclose in which currency the
AT1s would be denominated.AVIC INTL LEASING MEETS INVESTORSAVIC INTERNATIONAL LEASING, rated A– by Fitch,
has hired banks for a proposed offering of
US dollar senior unsecured bonds.
Bank of China, Barclays, CICC, DBS Bank and
Haitong International are joint global
coordinators as well as joint bookrunners
and joint lead managers with Agricultural
Bank of China Hong Kong branch, China Citic
Bank International, First Abu Dhabi Bank, ICBC
Asia and Mizuho Securities.
4HEû#HINESEûLEASINGûlRMûHASûSTARTEDûTOû
meet investors in Hong Kong, Singapore and
London from October 24.
The proposed Reg S notes, to be issued
under a US$1bn medium-term note
programme, will be issued by wholly owned
subsidiary Soar Wise and guaranteed by
AVIC International Leasing.
The notes have an expected A– rating
from Fitch, in line with the guarantor.BLUESTAR EYES US DOLLAR PERPSCHINA NATIONAL BLUESTAR (GROUP), rated Baa2/
BBB/A–, has hired four banks for a proposed
offering of US dollar-denominated senior
guaranteed perpetual securities.
BNP Paribas, BOC International, Credit
Agricole and Morgan Stanley are joint global
coordinators, joint lead managers and joint
bookrunners on the Reg S issue.
The chemicals producer, which is 63.6%
owned by state-owned China National
Chemical Corp (ChemChina), has started to
meet investors in Hong Kong, Singapore and
London, from October 25.
Bluestar Finance Holdings is the issuer of
the proposed notes and China National
Bluestar is the guarantor.
The notes have expected ratings of Baa2/
BBB+ (Moody’s/Fitch).
Moody’s on October 15 changed China
National Bluestar’s Baa2 rating outlook to
stable from negative, citing expectations
THATûTHEûCOMPANYSûIMPROVEDûCREDITûPROlLEûEMERGING MARKETS ASIA-PACIFICTenaga uncovers 10-year
demand
MALAYSIA Utility attracts quality accounts against tricky backdropTENAGA NASIONAL, rated A3/BBB+ (Moody’s/S&P),
successfully raised long-term funds in a fragile
market that was still recovering from recent losses
and kept other US dollar issuers away.
Malaysia’s largest electric utility priced a US$750m
10-year bond at Treasuries plus 170bp, allowing it to
term out maturities beyond 2025 and 2026.
Asian accounts provided the bulk of the support,
but appetite from the Middle East for the first Asian
corporate US dollar sukuk since 2016 was modest.
A banker on the deal explained that Middle Eastern
interest was currently skewed to domestic assets
given higher oil prices and a stronger US dollar.
Concerns about sales of Malaysian assets
by foreign investors and trade tensions also
softened investor appetite, the banker said.
The World Bank this month said Malaysia’s
economy is expected to grow at a slower-than-
expected 4.9% this year due to cancellations of
infrastructure projects and the trade situation.
Tenaga’s shares are down 7% in the year to
date, while the yield on its US$750m 3.24%
2026 bond spiked more than 20bp in the second
quarter, according to Refinitiv data.
Malaysia will continue to face substantial risks
because of the uncertain external environment,
the World Bank said.
Since the election victory of Mahathir
Mohamad’s coalition in May, the new
administration has pushed to review major
infrastructure projects launched by the
previous government and has cracked down on
corruption.
However, the ringgit has weathered volatility
better than its Asian peers, with the currency down
only 2.8% so far this year against the US dollar. The
Indonesian rupiah and Indian rupee have weakened
12% and 15% during the same period.
“The market presented itself to be not the
best, but the issuer framed the deal well during
the roadshow. The credit is solid and the qualityof this book was good,” said the first banker. “We
could have pushed for more and had 160bp in
our pocket, but we didn’t, judging by the softer
sentiment. People appreciated that.”
The notes were spotted at 165bp/163bp the
next day.
Moody’s said Tenaga’s financial profile is
expected to weaken over the next three years,
after factoring in the new sukuk, planned
capital spending and a new tariff. Tenaga is
also planning to invest in emerging economies
with strong growth potential. Moody’s warned
that this could expose it to uncertain regulatory
and operating environments, such as a recent
M$206.5m (US$50m) asset impairment in
Turkey.
Fair value was based on Tenaga’s outstanding
October 2026s, which were spotted at the Treasuries
plus 145bp level. Adding a two-year curve extension
brought fair value to 155bp–160bp, leaving a new-
issue concession for investors of around 10bp–15bp.
Initial price guidance had been announced on
Tuesday morning at 190bp area.
The Reg S issue drew final orders of over
US$1.25bn from 94 accounts.
Of the notes, 82% went to Asia, 15% to Europe,
and 3% to the Middle East. By investor type, 44%
went to fund managers, 42% to banks, and 14% to
insurance, pension funds and sovereigns.
The bonds will be drawn from a multi-currency
sukuk issuance programme via TNB Global
Ventures Capital. The sukuk are expected to be
rated A3/BBB (Moody’s/S&P).
Tenaga plans to use the proceeds for
general corporate purposes, refinancing and
international investments. The utility is 28%
owned by Khazanah Nasional, Malaysia’s
sovereign wealth fund.
BNP Paribas, CIMB, Citigroup and HSBC were
joint bookrunners.
Frances Yoon