CWG unit injects US$25m debt financing in US hospitality business
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CWG International's wholly owned subsidiary, Chiwayland Group (S), has subscribed to a promissory note with a principal amount of US$25 million that was issued by Delaware-incorporated US Hospitality Investments, LLC.
CWG said late Saturday, the note that bears an interest rate of 10 per cent, will mature in 10 years from the issuance date.
Chiwayland has received a corporate guarantee by Urban Commons, LLC, the manager of US Hospitality Investments. US Hospitality Common Co, LLC has also pledged over 85 per cent of its common equity interests in US Hospitality Investments in favour of Chiwayland.
US Hospitality Investments holds hotel properties in the US. Urban Commons is an existing joint venture partner of CWG group in the US. The proceeds from the issuance of the note will be used by US Hospitality to acquire certain designated hotel properties.
CWG will draw on internal funds and an interest-free loan from its controlling shareholder, Sinway Investment Co, to finance the subscription of the promissory note.
The company said that the transaction will allow it to invest in an established business by way of debt financing.
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