Li & Fung targets US$500m from first global bond offering

Li & Fung, a Hong Kong-listed trading company, plans to raise as much as US$500 million in its first global bond sale to fund business development and acquisitions, according to market sources.

The company planned to raise between US$300 million and US$500 million from the sale of 10-year bonds, the sources said yesterday.

Citigroup and HSBC are arranging the sale.

'It's cheaper for the company to issue US dollar international bond than borrow locally,' an analyst said. 'It's a kind of refinancing basically to repay some higher priced and short-term maturity debt.'

Li & Fung is in the last of its second three-year plan with a target of US$10 billion in turnover.

Its turnover was HK$68.01 billion last year.

To meet the target, it bought KarstadtQuelle International Services, Oxford Womenswear Group and Rosetti Handbags and Accessories last year.