Shui On Development to issue senior notes

PROPERTY developer Shui On Development has entered into a purchase agreement with Standard Chartered Bank and Deutsche Bank in connection with a senior notes issue of an aggregate principal amount of US$500 million due in 2021.

The offer price will be 99.384 per cent of the principal amount of the notes. The notes will bear interest at a rate of 5.7 per cent per annum, payable semi-annually in arrears on Feb 6 and Aug 6 of each year, commencing Aug 6, 2017.

At any time prior to the maturity date of the notes, Shui On Development may at its option redeem the notes, in whole or in part, at a redemption price equal to 100 per cent of the principal amount of the notes redeemed.

The estimated net proceeds of the notes issue, after deduction of fees, commissions and expenses, will amount to approximately US$492 million. The group intends to use the net proceeds from the notes to repay existing indebtedness with near-term maturities and to fund capital expenditures.