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Dongfeng launches €600M notes offering

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Dongfeng launches €600M notes offering

The Hong Kong subsidiary of China's Dongfeng Motor Group Co. Ltd. will issue notes worth €600 million on or about Oct. 23, the automaker said in an Oct. 18 stock exchange filing.

The first tranche comprises €500 million notes maturing in 2021 that bear an annual interest rate of 1.15%. The issue price for the 2021 notes will be 99.947% of the principal amount.

The second tranche is for €100 million worth of notes due 2023 that will bear an annual interest rate of 1.606% and will be issued at par with the principal amount.

The notes, which will be paid Oct. 23 of each year, will be issued in denominations of €100,000 and in multiples of €1,000 in excess of the amount.

Dongfeng Motor (Hong Kong) International Co. Ltd. said it expects to generate approximately €599.7 million from the offering, after deducting management, selling commission and offering expenses.

Net proceeds from the issuance will be used to refinance existing indebtedness and for general corporate purposes.

The notes will be listed on Ireland's main stock exchange, Euronext Dublin, and offered and sold outside the U.S.

Dongfeng said it may redeem the notes in whole at any time upon giving notice not less than 30 days but not exceeding 60 days prior to the redemption and at a price equal to the unpaid amount plus interest.

The company expects the notes to be rated A2 by Moody's and A by S&P Global Ratings.

Bank of China Ltd., Deutsche Bank AG London Branch, The Hongkong and Shanghai Banking Corp. Ltd., ICBC International Securities Ltd., Industrial and Commercial Bank of China (Europe) SA, BNP Paribas, Bank of Communications Co. Ltd. Hong Kong Branch and Société Générale are the joint lead managers for the notes offering.