THE Kowloon Canton Railway Corp is set to borrow HK$24 billion on international capital markets to help fund the HK$64 billion West Rail development project.
KCRC chairman and chief executive Yeung Ki-yin confirmed yesterday that fund-raising documentation was being prepared over the next few months for bond issues both in Hong Kong and on international markets.
On Thursday, investors snapped up a US$750 million bond issue from the Mass Transit Railway Corp, Hong Kong's first global debt issue since the start of the Asian economic crisis.
Mr Yeung said KCRC had had preliminary talks with bankers in New York last year, and that the group was in discussions with investment banks, which would be used to lead any issue.
Mr Yeung said: 'I am gearing up my engineers and project managers for West Rail, and on the financial side I am getting the corporate treasury to get ready to issue a KCRC bond - partly in US dollars, partly in Hong Kong dollars, and we won't ignore the euro either.' Ideally any issue, expected to have a 10-year maturity, will not be made before the beginning of next year.
Further financing was also likely to come in the form of syndicated loans for bridging finance. Some might be sought in the Hong Kong market, where Mr Yeung said the KCRC might be able to raise HK$3 billion to HK$5 billion, with terms of only about five years.
'The rest will be bonds issued on the US or the European market,' Mr Yeung said.
