SC Lowy’s debt capital markets team launches debut deals
9 December 2015, HONG KONG – Fixed-income specialist SC Lowy has helped two high-yield issuers raise new debt capital from international investors, underscoring the successful start of its new debt capital markets business. “The Asian high-yield bond market offers significant potential for expansion and we will continue to invest in capturing this opportunity despite a very challenging environment,” says SC Lowy chief executive Michel Löwy. “Helping borrowers to raise fresh funding and creating new supply of debt instruments is a natural extension of what we do.”
On December 8, SC Lowy acted as joint bookrunner and joint lead manager on Hydoo International Holding Limited’s debut US$100 million three-year Reg S senior notes issue. A day earlier, on December 7, it acted as sole placement agent for a US$30 million three-year Reg S senior notes issue for China Automation Group.
“Both transactions are of real strategic importance as they make our entry into the primary capital markets visible,” says Florian Schmidt, SC Lowy’s head of debt capital markets. “Issuers and investors alike appreciate the emergence of SC Lowy as a primary player that contributes substantially to secondary-market liquidity in Asia-Pacific high yield.”
Hydoo is a leading developer and operator of integrated trade and logistics centres in third- and fourth-tier cities in China, as well as selected second-tier cities. It is the only maiden issuer from the Chinese property sector that has successfully tapped the US dollar bond market so far in 2015.
The bookrunners priced the transaction at 99.404 with a 13.75% coupon, supported by demand from high-quality accounts. Proceeds will be used for financing the acquisition of land-use rights and development of projects, for repayment of debts and general corporate purposes.
China Automation is a leading provider of safety systems and control valves to the petrochemical industry and also one of the qualified suppliers of traction systems and power equipment to the railway industry in China.
The deal represents its second foray into the international debt capital markets after its debut in 2011. Proceeds of the offering will primarily be used to refinance its remaining US$72 million outstanding notes, which are due in April 2016.
About SC Lowy
Private and employee-owned, SC Lowy is the only independent fixed income specialist with full investment bank capabilities. Operating two distinct businesses, Primary Issuance and Secondary Trading, we focus on loans, bonds, trade claims and special situations. Our research covers energy, infrastructure, manufacturing, telecom & media, metals & mining, financials, shipping and real estate.
Headquartered in Hong Kong, with a team of investment professionals located across London, Seoul and New York, SC Lowy has built a global client network of over 700 international and regional banks, asset managers, hedge funds, private equity and pension funds, family offices and corporations.