Emerging Markets: China corporates prop up primary volume: MTR, Wynn Macau price tranches

By Rebecca Melvin

New York, Aug. 21 – Deals by corporates and state-owned entities in China comprised the majority of the emerging markets primary debt market this past week as the summer slowdown moved beyond its mid-August peak.

There was volume of $4.251 billion in 10 deals for the week ending Aug. 21, compared to $1.322 billion in five deals for the same week last year, according to data compiled by Prospect News.

The operator of Hong Kong’s Mass Transit Railway metro system, MTR Corp. Ltd., priced $1.2 billion of 1 5/8% fixed-rate notes due 2030. The notes were listed on the Hong Kong stock exchange on Thursday.

HSBC and Goldman Sachs (Asia) LLC are joint lead managers and, along with Bank of China (Hong Kong), Credit Agricole CIB, Mizuho Securities and Standard Chartered Bank, joint bookrunners for the Regulation S offering, which priced under the company’s $5 billion debt issuance program.

Meanwhile, Wynn Macau Ltd., located in China’s Macau special administrative region, priced $850 million of senior notes (B1/BB-) in two tranches on Wednesday.

The gaming and entertainment facilities operator priced a $250 million add-on to the company’s 5½% senior notes due Jan. 15, 2026. The notes priced at 100.25 for a yield to maturity of 5.443%.

The company also priced $600 million of new eight-year senior notes at par to yield 5 5/8%. The yield printed on top of final yield talk and tight to earlier talk in the 5¾% area. Initial talk was in the high 5% area.

Sole global coordinator and left lead bookrunner Deutsche Bank will bill and deliver. Joint bookrunners are Banco Nacional Ultramarino, SA, Bank of China Macau Branch, Bank of Communications Macau, BNP Paribas, BOC International, BofA Securities, DBS Bank Ltd., ICBC (Macau), JPMorgan, Scotiabank, SMBC Nikko and United Overseas Bank.

The proceeds are earmarked to pay down a term loan.

China Great Wall AMC (International) Holdings Co. Ltd. sold $500 million 2 3/8% 10-year notes via subsidiary China Great Wall International Holdings V Ltd.

The Beijing-based asset management company is focused on distressed asset management and 97% government-owned.

Bank of Communications, ICBC, Agricultural Bank of China, Bank of China, China Construction Bank, Standard Chartered Bank and Morgan Stanley were the joint global coordinators and the joint bookrunners and lead managers for the Regulation S deal, along with China Merchants Bank, China Merchants Securities (HK), CLSA, China Citic Bank International, China Everbright Bank Hong Kong Branch, Shanghai Pudong Development Bank, China Minsheng Banking Corp., Ltd., Dongxing Securities (Hong Kong), Guotai Junan International and Credit Agricole CIB.

Yunda Holding Co. Ltd., a provider of air courier and other services in China and based in Shanghai, priced $500 million of 2¼% notes due 2025. ICBC International and Standard Chartered Bank (joint global coordinators) were bookrunners and joint lead managers of the Regulation S deal together with Bank of China, China International Capital Corp., CLSA and BOSC International.

And Hangzhou Qiantang New Area Construction and Investment Group Co. Ltd. priced $300 million of 3.2% bonds due 2023, according to a notice of listing on the Stock Exchange of Hong Kong Ltd.

The joint lead managers and joint bookrunners are Guosen Securities (HK), ABC International, BOSC International, CMBC Capital, China Minsheng Banking Corp., Ltd., Hong Kong Branch, GS Securities. Goldbridge Securities, CNCB Capital, Bank of China, Haitong International, Bank of Ningbo, PRC Advisors and China Zheshang Bank. The joint global coordinators are Guosen, ABC and BOSC.

Listing was expected for Wednesday.

The construction and development company is based in Hangzhou, Zhejiang, China.

Beyond China, Axiata Group Bhd., a telecommunications conglomerate based in Kuala Lumpur, issued $1.5 billion of securities due 2030 and 2050 on Wednesday.

The Axiata SPV2 Bhd. subsidiary issued $500 million of 2.163% 10-year senior sukuk trust certificates (BBB+).

The Axiata SPV5 (Labuan) Ltd. subsidiary issued $1 billion of 3.064% 30-year notes (BBB+) guaranteed by Axiata.

CIMB Investment Bank Bhd., Citigroup Global Markets Ltd., Standard Chartered Bank and UBS AG Singapore Branch are lead managers and bookrunners for both tranches.

The rest of the EM world was quieted as summer vacation schedules thinned the ranks of bankers, investors and managers at their desks.

But details emerged on Chile’s Empresa de los Ferrocarriles del Estado (EFE) $500 million of 3.068% 30-year notes (A+/A). The deal, sold by bookrunners Goldman Sachs and Banco Santander USA, represented the company’s first bond placement in the international market. More than 100 institutional investors from Asia, Europe, North America and Latin America participated.

The proceeds of the notes are expected to be used for project financing, specifically various projects of the Chile Sobre Rieles plan, such as the train to Santiago – Melipilla, the new bridge over the Biobio and the train to Chillan, among others.

The issuer is the national railway of Chile with headquarters in Santiago.

Looking ahead, Rizal Commercial Banking Corp., a lender based in Makati City, Philippines, plans to offer dollar-denominated perpetual non-call five-year non-cumulative subordinated additional tier 1 securities (expected: Ba3), according to a notice.

Credit Suisse has been mandated as global coordinator and bookrunner and will arrange a series of fixed-income investor calls starting on Tuesday for the Regulation S notes.

In local currency, Chinese Maritime Transport Ltd. issued NT$2.5 billion of guaranteed bonds in four parts, according to an announcement.

The issue is comprised of NT$1 billion of 0.64% notes, NT$500 million of 0.64% notes, NT$500 million of 0.66% notes and NT$500 million of 0.66% notes, all priced at par with a tenor of five years.

Mega Securities Co., Ltd. is the underwriter.

Proceeds from the public offering will be used to repay short-term borrowings.

The issuer is a Taiwan-based company in the marine transportation business.

Argentina’s debt restructuring

The ad hoc group of Argentina exchange bondholders announced that its members have agreed to tender about $3.7 billion of exchange bonds and $1.1 billion of global bonds in connection with the republic’s Aug. 17 invitation to exchange and second amended prospectus supplement, according to a release on Friday.

The exchange bondholders said that its members have committed to tender the bonds on or before Aug. 24. Those who consent to the exchange prior to the Aug. 28 expiration date will be eligible to receive additional consideration on account of accrued interest and will have greater ability to select the new bonds received. Those who do not consent to the offer will not receive the additional benefits.

“The republic’s amended proposal is a consensual resolution that offers a beneficial outcome for all participants and is an offer that all creditors should accept,” the exchange bondholder group release stated. The group urged all holders of exchange and global bonds to join them in participating in Argentina’s external debt restructuring.

Two other Argentina bondholder groups are the ad hoc group of Argentine bondholders and the Argentina creditor committee. The exchange bondholder group is advised by Quinn Emanuel Urquhart & Sullivan LLP.

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