Chinese investment holding company, Fosun International, returned to the international bond market as it raised a further US$600 million when it re-opened a transaction that it priced in March this year.
The company priced on April 21 a US$600 million 5.25% five-year non-call three senior note, representing the largest US dollar senior note offering ever in the Chinese high yield non-property debt capital market space. The Reg S only deal was priced at 101.287% with a re-offer yield of 4.95% – or 17.5bp inside the initial price guidance of 5.125% area – a record low yield for the company.
The original transaction amounting to US$800 million was re-opened following reverse enquiries from investors, bringing the total outstanding size to US$1.4 billion.
The final order book was over 2.5x oversubscribed with a total demand in excess of US$1.5 billion following a quick-to-market, intra-day execution. The bulk of the paper was sold in Asia at 93% with the remaining 7% allocated in Europe. By investor type, fund managers accounted for 75%, banks 16% and private banks 9%.
Proceeds from the bond offering, issued through Fortune Star (BVI) Limited, will be used to refinance some of the company’s existing indebtedness, for mergers and acquisitions, for working capital, and for general corporate purposes.
Credit Suisse acted as the sole global coordinator for the transaction, as well as a joint bookrunner and lead manager along with AMTD, Crédit Agricole CIB, Fosun Hani and Haitong International.
Fosun maintained its strong growth momentum of development and made significant breakthroughs in its business performance in 2016. The group’s consolidated assets as of December 31 grew 19.5% to 486.78 billion yuan (US$71.06 billion) and the equity attributable to the owners of the parent rose 21.9% to 92.37 billion yuan (US$13.41) in 2016, compared with the previous year. Profit attributable to the owners amounted to 10.27 billion yuan (US$1.49 billion), representing a year-on-year growth of 27.7%.
Photo courtesy of Fosun.
