Acquisitive Dah Sing in US$150m debt issue
Dah Sing Banking Group, which is on an acquisition trail, yesterday launched an offer of subordinate debt to raise US$150 million from the bond market, according to a source familiar with the deal.
The issue has a tenure of 12 years but contains a seven-year call option, which means Dah Sing Bank could redeem the paper from the seventh year on, the source told the South China Morning Post yesterday.
Standard Chartered Bank is the lead bookrunner for the deal.
The paper will be priced at a yield of about 0.67 per cent on top of the US dollar swap rate, which stood at 4.72 per cent yesterday.
The price would be fixed within the next few days, the source said.
Bankers believe the deal will help finance the bank's acquisition plans and boost its second-tier capital, which stood at 16.5 per cent last year.
They said the offer was popular with investors.
Derek Wong Hon-hing, the managing director of Dah Sing Bank, said earlier this week that the bank would target acquisitions to expand its business in Hong Kong and the mainland.
This came after the bank agreed last week to buy most of the Macau-based assets of Portugal's Banco Comercial Portugues for $1.67 billion.
In June, the bank spent $936 million in cash to buy Pacific Finance, a Hong Kong consumer finance company.
Last week, the bank's parent company, Dah Sing Financial Holdings, spent $57.72 million to purchase a 20 per cent stake in Great Wall Life Insurance, a new joint venture formed with six mainland firms.