Ronshine China sets exchange cap for 8¼% notes at $400 million

By Sarah Lizee

Olympia, Wash., Feb. 12 – Ronshine China Holdings Ltd. set the maximum acceptance amount at $400 million in the exchange offer for its $800 million of outstanding 8¼% senior notes due 2021, according to a company announcement.

The exchange consideration was also amended so that for each $1,000 principal amount of outstanding notes validly tendered and not accepted for exchange prior to the exchange expiration deadline, each holder will receive the consent fee of $1.50 for each $1,000 principal amount of outstanding old notes held by that holder, subject to the conditions of the consent solicitation.

The company also announced that the minimum interest rate for the new notes will be 11¼%. The final yield will be set at pricing.

As previously reported, the company began the exchange offer on Feb. 8.

For each $1,000 principal amount of 8¼% notes, holders will get $1,000 principal amount of new notes, $2.50 in cash, capitalized interest and, in the event that any tendering holder is entitled to receive new notes in a principal amount that is not an integral multiple of $1,000, cash in lieu of any fractional amount of the new notes equal to the principal amount of the new notes not issued.

The offer is only open to non-U.S. persons outside the United States.

The exchange expiration deadline is 11 a.m. ET on Feb. 15. Settlement is expected for Feb. 25.

The company is selling additional new notes via a separate concurrent offering and will use the proceeds to refinance existing debt.

The company said the principal purpose of the exchange offer is to extend the maturity profile of a portion of the company’s existing senior debt and provide the company with additional financial flexibility to pursue its strategic objectives.

Ronshine is also soliciting the consent of holders of a majority of the outstanding 8¼% notes to amend some terms of the February 2019 indenture, including revising the timing of the put option of the old notes and adding some carve-outs to the limitation on debt and limitation on restricted payments covenants.

Holders who validly tender any 8¼% notes in the exchange offer will be deemed to have delivered a consent to the proposed amendments. Holders will have the option to participate in the consent solicitation without participating in the exchange offer.

Holders who deliver their consents without tendering any of 8¼% notes by the consent expiration deadline will get $1.50 per $1,000 of notes. Holders who tender 8¼% notes under the exchange offer will not receive a consent fee.

The consent expiration deadline is 11 a.m. ET on Feb. 15.

Credit Suisse and UBS are dealer managers and solicitation agents. D.F. King (+44 20 7920 9700, +852 3953 7200 or ronshine@dfkingltd.com) is the information and exchange agent.

Fuzhou, China-based Ronshine is a property developer.

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