Securitization of China's non-performing loans will grow in 2017
In 2017, Moody’s expects corporate NPLs to be th...
In a year of lower loan syndication volume amid the global market volatility, event-driven financing has kept the banks busy in 2016. With prevalent robust liquidity, the regional loan market continues to manifest its ability to provide certainty in execution, even for large M&A-related funding.
Four banks have demonstrated their capability to provide a range of financing solutions, in both corporate acquisitions and financial sponsors.
Citi was a mandated lead arranger, bookrunner, and underwriter in the A$500 million facility to pre-fund Universal Robina Corporation’s acquisition of Snack Brands of Australia. It was involved in the US$775 million financing package to back Intas Pharmaceuticals’ acquisition of Actavis UK and Ireland generics businesses from Teva Pharmaceutical.
Citi also anchored the financing package for Tata Steel Global Holdings for US$1.5 billion, amid the backdrop of a ratings downgrade by Standard & Poor’s, weaker-than-expected operating performance, and the shrinking bank market appetite for the industry. The deal garnered additional retail liquidity even in unfavourable market conditions.
Credit Suisse rode on the key themes in the market in 2016, arranging financing to support both cross-border and domestic acquisitions, as well as privatizations across multiple geographies. It was a joint mandated lead arranger, underwriter, and bookrunner in the US$12.7 billion acquisition bridge loan for ChemChina to purchase Syngenta of Switzerland, and in the 450 million euro acquisition loan, also for ChemChina, to acquire KraussMaffei of Germany.
In the largest rupee acquisition financing in the domestic market for leveraged acquisition, Credit Suisse helped arrange a 40 billion rupee facility for Nirma Limited to acquire 100% of Lafarge India. The equity contribution was funded via recourse debt on Nirma’s balance sheet.
Credit Suisse successfully syndicated complex structures such as holdco financing, structured equity-linked loans, share-backed financing, and receivable-backed loans. It also opened the loan market for sovereign issuers in frontier markets, including Mongolia, Pakistan, Papua New Guinea, Sri Lanka, and Vietnam.
HSBC was involved in several significant leveraged and acquisition financing in 2016, such as in the US$20 billion acquisition facility to support ChemChina’s purchase of Syngenta. It was a mandated lead arranger in the HK$2.8 billion financing to support Permira’s 100% stake acquisition of Tricor, and was a joint mandated lead arranger and bookrunner in the US$3.5 billion financing for Tencent-led consortium in acquiring a majority stake in Supercell.
HSBC helped arrange the 3.2 billion euro one-year bridge facility for Berli Jucker, for the acquisition of a 100% stake in Big C Supercenter, and the US$500 million bridge financing for Cipla to acquire 100% of InvaGen Pharmaceuticals. It also successfully executed the US$320 million bridge facility for Lei Shing Hong to restructure its automobile dealership business.
The ability to support cross-border acquisitions is also a core strength and differentiating factor for Standard Chartered as a strong candidate for best leveraged/acquisition finance house. It acted as the mandated lead arranger for the 6.4 billion euro term facilities to Pirelli to take out the acquisition facilities for the privatization of Pirelli by ChemChina-led consortium in 2015.
In the domestic front, the bank also led some of the large structured/acquisition financings, such as the 3.2 billion euro, one-year bridge facility to fund Berli Jucker’s acquisition of a majority stake in Big C Supercenter, in which it acted as mandated lead arranger. Standard Chartered likewise showcased its strong relationship with financial sponsors, as it jointly arranged a US$170 million three-month bridge financing for AION Capital Partners and former GE Group executives, to acquire the commercial lending and leasing operations of GE Capital group in India for about US$300 million.
The winner of the Triple A Best Leveraged/ Acquisition Finance House will be revealed on February 28, 2017 during The Asset’s Regional House & Deal Awards Dinner. For more information about the awards ceremony please click here
For the full list of the winners and nominees of the Triple A Regional Awards 2016 please click here.
Who else do you think should win the Triple A Regional Awards? Click here to vote for other categories.
11 Jan 2017