Fosun International US dollar bond successfully priced
HONG KONG, Oct. 16, 2020 /PRNewswire/ -- Fosun International Limited (HKEX stock code: 00656, "Fosun International", "Fosun" or "the Company") successfully priced US$400 million 5-year senior unsecured notes with coupon rate of 5.95% at par on 12 October; concurrently, the Company announced a tender offer targeting its existing approximate US$410 million 6.875% senior notes due in January 2021. The Company identified a supportive market window post China's National Day holiday, and eventually priced the new notes ahead of large volume of competing supply as well as increasing market volatilities. The deal marked another successful benchmark transaction in Fosun International overseas debt financing space. 176 investors participated in the transaction, and total orderbook peaked at over US$2.6 billion with final landing at 5.95%, 45bps tightening from initial price guidance ("IPG") level. Oversubscription rate reached about 5.8x after final price guidance was released.
Amid volatile market conditions due to the COVID-19 pandemic together with subsequent rating adjustments to multiple sectors globally, the transaction obtained target issue size with tenor extension (by 1 more year) and lower financing costs (by 90bps) compared with its latest 4-year offshore bond issued in June 2020. The robust orderbook momentum supported by high quality international investors highlighted Fosun's solid credit and well-recognized business strategy as a long-term investment target.
Fosun has established diversified financing channels, well-recognized financing capabilities and prudent financial policies, and has been proactively managing its debt duration and yield curve. The Company aims to extend current debt maturity profile through this tender offer with concurrent new issuance structure, which minimizes additional debt and reduces financing costs. This also demonstrates the Company's rigorous financial and capital management principles.
The issuance achieved well diversified investors participation across both geography and investor types. By geography, Asia investors were allocated 92% of the deal and EMEA accounts for 8%; by investor types, Asset/Fund Managers were allocated 90%, Banks/Financial Institutions accounts for 3% and Private Banks accounts for 7%. Fosun also successfully expanded its offshore fixed income investors base with orderbook allocation focused on both high quality existing bond holders as well as new investors.
This deal achieved the optimal pricing (tightening by 45bps from IPG) and largest issue size amongst 4 Chinese High Yield transactions launched on the same day. It also marked another 5-year bond issuance for Fosun with yield level below 6% after January 2018. The Company will always adhere to its strategy of being one of the top credits in offshore debt capital market, providing long-term stable return to investors.
Fosun was founded in 1992. Fosun's mission is to provide high-quality products and services for families around the world in health, happiness and wealth businesses. Fosun International Limited is an innovation-driven consumer group that has been listed on the main board of the Hong Kong Stock Exchange (00656.HK) since 2007, with total revenue of RMB143.0 billion (c.US$20.7 billion) in 2019 and total assets of RMB745.0 billion (c.US$105.2 billion) as of 30 June 2020. Fosun International ranks No.371 on the 2020 Forbes Global 2000 List.
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