Herbert Smith has recently advised China International Capital Corporation, Goldman Sachs and Nomura as joint underwriters on the US$1.838 billion (HK$15.85 billion) Regulation S international offering of convertible bonds by a subsidiary of China Unicom (Hong Kong), a Hong Kong and New York listed telecommunication service provider in China. The bonds, which will be listed on the Hong Kong Stock Exchange, are guaranteed by China Unicom (Hong Kong). The offering is the world’s largest international convertible bond issuance by a PRC company to date.
The 5-year convertible bonds will mature in October 2015. The bonds are convertible into common shares of China Unicom (Hong Kong). The bondholders may request that shares issued upon conversion be delivered in the form of China Unicom’s American depositary shares listed on the New York Stock Exchange.
Proceeds raised from the issuance will be used as working capital and for other general corporate purposes.
According to media reports, this convertible bond is the largest ever in Asia ex-Japan, exceeding the $1.5 billion offering by Sinopec in 2007, in which Herbert Smith acted for Sinopec.
The Herbert Smith Hong Kong corporate team was led by Kevin Roy, assisted by Melody Chen, Dinesh Banani and Han Han. Jason Sung, Stanley Xie and Gloria Lam also provided assistance.
Kevin commented:
“We were delighted to be able to advise the underwriters on this significant convertible bond issue for China Unicom, which provides an excellent example of the versatility and strength of our capital markets practice in Asia.”
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