Recently, Xiaomi Corporation (1810.HK, “Xiaomi” or the “Company”) successfully priced its US$1.2bn dual-tranche 144a/Regulation S bond offering, including the new issue of US$800m 10-year senior fixed rate bond and US$400m 30-year senior fixed rate green bond (the “Transaction”). AMTD acted as a Joint Bookrunner and Joint Lead Manager on the Transaction.
This Transaction was a great success. This is the first ever green bond offering by Xiaomi and the first ever green bond offering in the TMT sector in Asia. The result of this bond issuance was outstanding, and it’s also the longest green bond ever issued in Asia and in the TMT sector globally. The Transaction achieved the lowest ever issue yield and coupon rate for a 10-year and 30-year USD bond by BBB-rated Chinese TMT companies, the issue yield of 10-year tranche in particular is 0.55 percentage point lower than Xiaomi’s debut 10-year USD bond issued last year.
The Company set IPG at T10+200bps area and OLB+260bps area. Orderbook momentum was strong right from the start and reached US$7.5bn at its peak, amounting to an oversubscription of over 6 times. Given the strong orderbook quality, the FPG was tightened to T10+165bps and OLB+220bps respectively, a significant reduction of 35-40 basis points from IPG. Xiaomi obtained investment-grade issuer ratings from all three international rating agencies, being Baa2 Stable by Moody’s, BBB- Positive by S&P and BBB Stable by Fitch, and the issue ratings are Baa2 by Moody’s, BBB- by S&P and BBB by Fitch.
This is yet another international capital market transactions completed by AMTD for Xiaomi, including its US$5.4bn HK IPO in 2018, its debut US$600m bond offering in 2020, and this time its first ever green bond offering.