Yuexiu Property subsidiary gets approval to issue RMB 2 billion bonds

By Angela McDaniels

Tacoma, Wash., May 16 – Guangzhou City Construction & Development Co., Ltd., a 95%-owned indirect subsidiary of Yuexiu Property Co. Ltd., plans to issue up to RMB 2 billion of housing rental special corporate bonds, according to an announcement.

The public offering has been approved by the China Securities Regulatory Commission.

The bonds will be issued in tranches.

The first tranche will have a principal amount of not more than RMB 1.5 billion and a term of five years. At the end of the third year, the issuer will have the option to adjust the coupon of a portion of the bonds, and the holders of those bonds will have the right to sell them back to the issuer. For the remaining portion of the bonds, the coupon will be fixed.

The issuer will begin marketing the first tranche of the bonds, and will determine the coupon rates for them, after bookbuilding.

The issuance is subject to a number of conditions.

Proceeds will be used for the construction of housing rental projects, investment related to housing rental and replenishment of liquid capital.

The issuer’s obligations to pay the principal and interest under the bonds are guaranteed by Guangzhou Yue Xiu Holdings Ltd., the ultimate controlling shareholder of Yuexiu Property.

Yuexiu Property is a property developer based in Hong Kong.

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