King & Wood Mallesons' (KWM) debt capital markets team in Hong Kong continues to maintain a robust track record in the high-yield space in 2019, having advised on a number of high-profile issuance with "first of the market" features and complex liability management components, by leading PRC companies, including most recently:
Represented ENN Ecological Holdings Co., Ltd. (ENN Ecological), as the Parent Guarantor, in its issuance of US$250 million 7.5% Guaranteed Senior Notes due 2021. This is ENN Ecological's debut offshore bond issuance and marks the first debut high-yield bond issued by a PRC industrial company since January 2018.
ENN Ecological is an A-share listed company and a leading clean energy products and services provider in the PRC. It principally engages in energy engineering services; production, sale and trading of energy and chemical products; and LNG's production, sale and investment. KWM advised ENN Ecological in respect of U.S. law and PRC law.
Represented Ronshine China Holdings Limited (Ronshine China) in its issuance of:
- US$300 million 10.5% Senior Notes due 2022;
- US$600 million 11.25% Senior Notes due 2021 (consisting of US$392 million issued pursuant to an exchange offer and US$208 million issued pursuant to a concurrent new money offering); and
- US$200 million 11.5% Senior Notes due 2020.
Ronshine China is a property developer in the PRC that focuses on the development of mid to high-end residential properties across eight regions, including the Guangdong Hong Kong-Macau Greater Bay Area, the Western Taiwan Straits Economic Zone, Yangtze River Delta regions, Beijing-Tianjin-Hebei Region, Central China Region, Chengdu-Chongqing Region, North-western cities and Middle Reaches Region of Yangtze River. KWM advised Ronshine China in respect of U.S. law and Hong Kong law.
In addition to the above transactions, the Hong Kong-based DCM team also advised on high-yield bonds and liability management exercises by Fujian Yango Group Co., Ltd, Yango Group Co., Ltd. Xinhu Zhongbao Co., Ltd., and Fantasia Holdings Group Co., Limited across the New Year period. KWM was recently voted "Law Firm of 2018" by users of the Wall Street Trader App.
The above issuance were all led by Hong Kong-based partners Hao Zhou and Michael Lu, with support from Counsel Cynthia Tan, and Senior Associates Jason Du and Lu Tan. Partner Richard Mazzochi and Counsel Ian Hardee provided Hong Kong law support. A team led by Beijing-based partners Yongliang Zhang and Yanyan Song advised ENN Ecological on PRC law.
Hao Zhou, Managing Partner, Clients commented, "I am pleased that we have kicked off the year with these high-profile debt issuance. The high-yield market in Hong Kong has reached another record high in the first two months of 2019 in terms of the number of issuance. The significant demand in refinancing has kept our DCM team busy since December 2018. Our strong execution capability, rich product experience and commitment to providing service of the highest quality under challenging timelines have earned us recognition from clients as the "go-to" firm for innovative and complex transactions with cross-border elements." Commenting on the outlook, Hao added "Liability management exercises will increasingly become more popular among PRC high-yield issuers as a useful and effective tool to manage their balance sheets."