Rapidly expanding Shangri-La Asia, which operates 49 resorts and hotels mainly across the region, is seeking a HK$3 billion syndicated loan for general working capital, according to market sources. The company will pay an interest margin of 29 basis points over the Hong Kong interbank offered rate (Hibor) and 34.5 basis points in fees to the arranging banks. Shangri-La Asia declined to comment. HSBC, DBS, Standard Chartered and Bank of China (Hong Kong) have been hired to organise the five-year loan which started syndication yesterday. The arrangers are seeking a minimum group of 10 banks and could bring in more, market sources said. The loan will run as a three-year revolving credit facility, where the borrower can draw down funds as needed, after which it will finish as a term loan. The firm last borrowed in 2002, when it took out a HK$3 billion, five-year loan, paying an interest margin of 41 basis points above Hibor. Shangri-La, controlled by the Kerry Group and a sister company of the South China Morning Post, aims to have up to 39,000 hotel rooms by 2011 from its current total of 24,000 rooms. The company has 23 properties under development, 16 self-owned, which represent an addition of 8,657 rooms. Some 84 per cent of those rooms will be located on the mainland where average room rates at the firm's existing properties rose 16 per cent to US$125 per night during the first six-months of the year. Shangri-La's growth strategy extends to gateway cities beyond Asia. In the first half, the company paid US$120 million for a historic mansion in Paris which will be converted into its first hotel in Europe. Last month, the company announced a 35.4 per cent increase in first-half earnings to US$82 million driven by rising room rates and sales. Turnover rose 20 per cent from a year earlier to US$469.98 million. Shares in Shangri-La dropped 1.3 per cent yesterday to close at HK$16.68.