Guangdong Hong Kong Greater Bay pitches exchange for maturing notes

Chicago, April 17 – Guangdong-Hong Kong Greater Bay Area Holdings Ltd. is offering to exchange two of its senior notes with maturities in 2023, to trade them for notes with a 36-month tenor, according to an offer announcement.

The exchange offer relates to the existing $75 million 12% senior notes due in May 2023 (ISIN: XS2485447838) and the $303.62 million 13.85% senior notes due in October 2023 (ISIN: XS2386427525).

The company is seeking to exchange at least 90% of each issue, or at least $67.5 million of the 12% notes and $273,258,000 of the 13.85% notes.

Guangdong is offering $1,010 in new notes and accrued interest for the May 2023 notes. The issuer is offering par and accrued interest for the October 2023 notes. The accrued interest on the existing notes will be paid in kind, in the form of new notes. The new notes will have a 7% interest rate and will mature on the last day of the 36th month after the original issue day. Interest will be paid 65% in kind and 35% in cash.

The company may also launch a scheme of arrangement in Hong Kong to effect a restructuring of the existing notes on terms similar to the exchange offer, but open to all holders of notes including U.S. persons as defined under Regulation S.

If the exchange offer is not successful, it may have to consider alternative debt restructurings, including resorting to a scheme or arrangement.

Tendering holders must also execute and agree to be bound by a restructuring support agreement.

Where the exchange offer is not consummated and the scheme is launched and consummated, subject to the terms of the restructuring support agreement, a fee of 0.3% of the aggregate principal amount of an eligible restricted note as of the instruction fee deadline will be paid on the restructuring effective date on existing notes tendered in the exchange offer and restricted in the restructuring support agreement.

Holders need to tender all of their notes. No partial tenders will be accepted.

The offer will expire at 11 a.m. ET on April 25.

Settlement is planned for April 28.

The new notes will potentially be listed on May 2.

China Citic Bank International Ltd. is the dealer manager.

Sidley Austin is the company’s legal adviser.

Kroll Issuer Services Ltd. is the information, exchange and tabulation agent (+44 20 7704 0880, +852 2281 0114, youngo@is.kroll.com, https://deals.is.kroll.com/youngo, https://deals.is.kroll.com/youngo-rsa).

The state-owned investment holding company is based in Guangdong, China.

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