Evergrande issued US dollar debt with interest rate of 11%.
Evergrande issued an announcement late today that the subsidiary company will issue an additional $1 billion of 11% of the preferred notes due in 2020. The proceeds are mainly from the refinancing of existing offshore debts. It has concluded purchase agreements with CITIC Bank (International), Guangyin International and Haitong International. This is only 20 days from the last announcement of US dollar debt.
Under the purchase agreement, issuers will issue additional bills, while co-global coordinators, co-book managers and co-lead agents CITIC Bank (International), Guangyin International and Haitong International will be the initial buyers of the additional bills. Additional issuance of bills will be guaranteed unconditionally and irrevocably by space-based holdings, subsidiary guarantors and any future joint venture subsidiary guarantors on common and individual benchmarks.
In addition, Evergrande Real Estate (as maintenance provider), Space-based Holdings (as parent company guarantor), issuer and Citigroup International Limited (as trustee of issuing additional bills) will conclude a maintenance and equity purchase agreement. The issuance will not be issued to the public in Hongkong.
However, although the company has received approval from the new stock exchange on the principle of listing and listing of additional bills on the new stock exchange, the company has not yet sought to issue additional bills in Hong Kong.
As the peak period of debt repayment is approaching and the funds of Chinese real estate enterprises are becoming more and more tight, Hengda, the leading real estate company in China, has previously announced the issuance of up to $1.8 billion of high-interest bonds on October 31. The net amount of the proceeds is mainly used for refinancing the existing offshore debt. According to data compiled by Bloomberg, the 13.75% interest rate on the 1.8 billion high-interest bonds is the highest among Asian junk bond issuers this year.
Industry insiders told Wall Street that U.S. dollar preferred notes are also priced according to the market. In fact, 13.75 interest rates were common in previous years, and the period was shorter. At present, the US dollar has raised interest rates several times, and interest rates have been rising as well.
Hengdas share price rose sharply today, up 5.15% at the close, but it evaporated nearly 30% from its peak in the year nearly three months ago, leaving only HK$260 billion in its latest market capitalization.
Source: editor of Wall Street news and responsibilities: Qiao Jun Jing _NBJ11279