Coastal Greenland, a small Hong Kong-listed mainland developer of commercial and residential properties, was preparing for its first public global bond sale to raise up to US$200 million to invest in properties and finance projects, market sources said.
The bond sale was likely to be 'over the next few weeks' rather than now as the region's offshore bond market was still volatile after the shakeout in the US sub-prime mortgage market, market and company sources said. They added that the company's financing needs were 'not that pressing'.
'The market condition is not so good right now,' said a portfolio manager at a Japanese fund house. 'Issuers won't issue [new bonds] that fast. They have to wait.'
HSBC was arranging the sale, which may total US$150 million to US$200 million, while Moody's and Standard & Poor's were finalising the company's credit rating, sources said.
Coastal Greenland hired Merrill Lynch for a US$40 million private bond placement in April last year. It develops and markets properties throughout the mainland in regions such as the Yangtze River Delta, Pearl River Delta and Bohai Rim.
The company's land bank was sufficient for development over the next three to four years, a company source said. Proceeds would be used for investment in commercial properties and the development of self-owned land.
Meanwhile, South China City Group, a property developer partly owned by Hong Kong-listed Tak Sing Alliance Group, had hired Merrill Lynch for a private placement of a five-year convertible bond to raise US$125 million for phase two of its Shenzhen South China City project and for general expansion, the company said.
The bonds can be converted into about 10 per cent of the company's ordinary shares.
Phase one of South China City, a logistics and trading platform for raw materials, was launched in 2004.
Coastal Greenland is waiting for bond market volatility to ease
The developer previously hired Merrill Lynch for a private bond placement worth, in US$: $40m