China’s KWG Property offers up to RMB 2.2 billion six-, 10-year bonds

By Marisa Wong

Morgantown, W.Va., March 24 – KWG Property Holding Ltd. said it plans to offer up to RMB 1 billion of bonds with an up to RMB 1.2 billion over-allotment option.

The company plans to issue two types of bonds through wholly owned subsidiary Guangzhou Tianjian Real Estate Development Ltd.

The six-year type 1 bonds are expected to bear interest at 3¼% to 4.8%, and the 10-year type 2 bonds are expected to carry a coupon of 4¼% to 6%. The final coupon will be determined through a book-building process.

After three years the issuer will be able to increase the coupon on the type 1 bonds, and after five years the issuer may raise the rate on the type 2 bonds.

Investors will also have a put option at the end of three years and five years, respectively.

China Securities Co., Ltd. will act as underwriter for the issue, as previously announced.

The bonds will be sold from March 25 to March 28.

Earlier this month the company said that the China Securities Regulatory Commission approved its application to issue up to RMB 2.2 billion of domestic corporate bonds.

Proceeds will be used for general working capital purposes.

China Chengxin Securities Ratings Co., Ltd. has assigned a rating of AAA to the bonds.

KWG Property is a developer based in Guangzhou, China.

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