Hong Kong rail operator MTR said to raise loan to HK$25b

[HONG KONG] Hong Kong railway operator MTR Corp increased the size of a two-part loan to about HK$25 billion (S$4.4 billion), after the city gave the green light for it to resume construction on a high-speed rail link to China earlier this year, people familiar with the matter said.

MTR, three-quarters owned by the government, lifted the size of its dual-tranche loan from HK$15 billion after more than 20 banks committed to the financing, according to people familiar with the matter, who aren't authorised to speak publicly and asked not to be identified.

The company won approval in March for the project to connect Hong Kong to Shenzhen and Guangzhou in southern China, after criticism for budget overruns and missed completion targets. MTR plans to raise fares by an average 2.65 per cent from June 26 and will further set aside HK$140 million for station facilities improvement projects, it said last month.

There was no immediate response after a person who answered the phone at the company took a message. There was also no immediate reply to an e-mail seeking comment.

Besides the Hong Kong subway system and other services in the city, MTR runs rail systems in cities including Beijing, Melbourne and Stockholm.

BLOOMBERG