Bonds News
- Vanke plans to sell ￥2b of bonds
Date: 16-Aug-2007 Sources: (Shenzhen Daily)
CHINA Vanke Co., the nation's biggest publicly traded developer, plans to sell about 2 billion yuan (US$264 million) of bonds, ushering the first wave of offerings after the government eased rules to expand the debt market, two people with knowledge of the transaction said.
Vanke hired CITIC Securities Co., China's biggest publicly traded brokerage, to arrange a bond sale, said the people, who asked not to be identified before an announcement by the company.
Vanke's plan to sell bonds hasn't yet received the regulator's approval. Industrial & Commercial Bank of China, the nation's biggest bank, may advise the company, the people said.
Zheng Jing, a Beijing-based spokeswoman for CITIC Securities, declined to comment. Zhang Tingfen, a spokeswoman for Vanke in Shenzhen, didn't answer calls to her office phone.
China Yangtze Power Co. plans to sell 8 billion yuan of bonds domestically to buy generators, the Caijing magazine reported last month, without saying where it got the information. The bonds will be sold over two years, according to the Beijing-based magazine.
THE national stock regulator has published new rules making it easier for listed companies to issue debt, potentially providing a lift for China's inactive corporate bond market.
Qualified companies will now be allowed to issue corporate bonds with a maturity of more than one year without bank guarantees, the China Securities Regulatory Commission (CSRC) said in a statement on its Web site late Tuesday.
The proceeds can be used for any general corporate purpose approved by its shareholders, but must conform with the government's macroeconomic policies, the commission said.
Previously, all corporate bonds had to be guaranteed by banks, and the proceeds could only be used for projects specifically approved by the government.
Companies have long complained that the National Development and Reform Commission has made corporate bond issues difficult, and as a result the corporate bond market has been largely inactive.
The stock regulator, which now has the power to approve debt sales by publicly traded companies, wants to widen companies' financing channels.
The regulator said that qualified companies can apply for authorization for an overall bond issue and then issue debt in several tranches under that approved amount.
The first tranche of any such issue, which should account for at least 50 percent of the total, should be made within six months after receiving approval. The remainder should be issued within 24 months, the securities regulator said.
Bonds to be sold by Chinese companies in accordance with the new rules will carry a face value of 100 yuan, with maturities of more than one year. The price should be decided by the company and the underwriter after gauging investor demand for the securities, according to the rules.
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