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Zhenro Properties Group raised $250mn via a 363-day green bond at a yield of 6.93%, 47bp inside the initial guidance of 7.4% area. The bonds have expected ratings of B+ and received orders over $2.8bn, 11.2x issue size. Proceeds will be used for debt refinancing. Asia and EMEA took 95% and 5% respectively. Fund and Asset Managers took 89% and private banks 11% respectively. The new bonds offer a new issue premium of 65bp over its older 8.7% bonds due August 2022 that are currently yielding 6.28%.
Xuchang General Investment raised $53mn via a 3Y bond at a yield of 4.8%, inline with the initial guidance. The proceeds from the unrated bonds will be used for project construction and general corporate purposes. The issuer is a municipal infrastructure construction and operation entity in Xuchang city in China’s Henan province.
A rights issue is one way for a company to raise capital by giving existing shareholders the option to buy additional shares of the company, typically at a discount to the current market price. The number of additional shares that can be bought is proportionate to the number of existing shares that a shareholder has. This ratio is also known as a rights entitlement ratio. Since a rights issue increases the number of shares of a company, share dilution may occur as the company’s earnings are now spread over a greater number of shares.
Bharti Airtel’s board of directors has approved plans for the company to raise up to INR 210bn ($2.86bn) through a rights issue.
On investors shunning Chinese high-yield debt after Evergrande shock
Edmund Goh, investment director at Aberdeen Standard Investments
“I would think that most of the weakness is contributed by the property developers.” “If Evergrande moves then it will have a pretty sizeable impact.”
Bruce Pang, head of research at investment bank China Renaissance
“[Developers] will continue to face liquidity drains in the near term… [and restrictions on] land auctions and fundraising opportunities”.