China Everbright Water has completed the issuance of the first tranche of perpetual medium term notes to institutional investors in the national inter-bank bond market of mainland China.
The notes have a principal amount of RMB700 million ($144.4 million). The RMB-denominated notes come with a maturity term of 3+N years and an interest rate of 3.30%.
The company had previously received a notice of registration from the National Association of Financial Market Institutional Investors of the People’s Republic of China to issue the perpetuals in multiple tranches with a registered principal amount of RMB3 billion.
According to the company, the first tranche of perpetuals were fully subscribed for by the institutional investors with a subscription rate of 2.36 times.
The proceeds will be used to repay the due debts of Everbright Water and its subsidiaries.
The first tranche of perpetuals and the company have each been rated “AAA” by Shanghai Brilliance Credit Rating & Investors Service Co., Ltd.
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Everbright Securities Company acted as the lead underwriter and bookrunner of the issuance. China CITIC Bank Corporation Limited acted as the joint lead underwriter.
Hu Yanguo, executive director and chairman of Everbright Water says, ““The successful issuance of the first tranche [of] perpetuals is another step that the company takes to diversify its financing channels, following its issuance of corporate bonds, asset-backed securities, medium-term notes, and super and short-term commercial papers in recent years.”
“The smooth issuance of the first tranche [of] perpetuals reflects the company’s active exploration of equity-based financing, which helps the company reduce gearing ratio, improve liquidity, and optimise capital structure,” Hu adds. “It will also facilitate the company to utilise a variety of financing tools and keep its financing costs within a reasonable range.”
He continues: “Going forward, Everbright Water will continue monitoring market conditions closely to arrange for issuance of the remaining perpetuals, in order to provide stable and flexible capital support for the company’s innovation-oriented and high-quality development.”
Shares in Everbright Water closed at 29.5 cents on June 13.
