Sunac China unit talks first tranche bonds at 3%-4.2%, 3½%-5%

By Marisa Wong

Morgantown, W.Va., Aug. 12 – Sunac China Holdings Ltd. announced that wholly owned subsidiary Sunac Real Estate Group Co., Ltd. plans to offer RMB 1 billion of non-guaranteed bonds with an over-allotment option for RMB 3 billion of additional bonds.

These first tranche bonds will consist of two types.

Type 1 bonds will have a term of five years and include an option to increase the coupon rate after the end of the third year as well as a put option. Type 2 bonds will have a term of seven years, with an option to increase the coupon rate after the end of the fifth year and also a put option.

The coupon for the type 1 bonds will be in the range of 3% to 4.2%, and the coupon for the type 2 bonds will be between 3½% and 5%. The final interest rates will be determined through a book-building process.

Guotai Junan Securities Co., Ltd. will act as lead underwriter, and China Securities Co., Ltd. will act as joint underwriter for the issuance.

The offer period will run from Aug. 15 to Aug. 16.

The China Securities Regulatory Commission had approved in June Sunac’s proposed issuance of up to RMB 4 billion of domestic corporate bonds.

Sunac is a Tianjin, China-based residential and commercial property developer.

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