Shenzhen Expressway to test drive China's new offshore bond scheme

Shenzhen Expressway (SZE) will be one of the first issuers in China to use the National Development and Reform Commission's newly implemented system to register plans to sell offshore bonds.

The new system will potentially make it easier for Chinese companies to raise offshore funds for onshore projects, and allow them to provide stronger guarantees to foreign bondholders.

The toll road operator, which already met investors in Hong Kong, Singapore and London at the beginning of this month, may receive approval to issue US dollar bonds as early as this Friday, according to a source familiar with the discussions.

The offering is unlikely to hit the market this month, said the source.

SZE's offering was delayed after the NDRC published a new policy on offshore debt issuance on September 16.

The policy does away with the need for Chinese foreign debt issuers to go through an approval process each time they issue bonds offshore.