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Sandy Li

Sogo department store operator Lifestyle International Holdings announced the issuance of 10-year bonds to raise US$300 million for debt repayment and future expansion.
The bonds, due to mature in 2025, will bear a fixed interest rate of 4.5 per cent per year.
In a filing with the Hong Kong stock exchange on Sunday, it said the net proceeds, after deduction of underwriting fees and expenses, would amount to US$295.6 million.
"It will be on-lent to the company and/or its subsidiaries for repayment of bank financing, funding of capital expenditures relating to store renovation and new department store projects in the future and general corporate purposes," said chairman Thomas Lau Luen-hung.
The bond has been assigned a rating of "Baa3 (Stable)" by rating agency Moody's Investors Services and "BB minus (Stable)" by Fitch Rating. The firm expected the bonds to be issued on or about June 29.
Prior to the issuance of the latest bond, the firm's bonds payable amounted to HK$6.16 billion, according to its annual report. They were a US$500 million five-year note due in January 2017; and a US$300 million 10-year bond due in October 2022.
It is also the first bond after Qatar's sovereign wealth fund acquired a 19.9 per cent stake in the company for HK$4.78 billion in October last year. Lifestyle's net debt to equity ratio was 19.9 per cent.
Lifestyle is the latest company to join the wave of firms in a fund raising exercise.
Early this month, Lenovo Group, the world's largest personal computer supplier, also announced the issuance of five-year notes to raise 4 billion yuan due in 2020 with annual interest at 4.95 per cent.
Besides tapping the offshore bond market, Beijing Capital Land last week said it would issue onshore corporate bonds in one or more tranches to raise 5 billion yuan (HK$6.3 billion) to replenish working capital and repay part of its existing loans.
Hong Kong-listed developer Beijing Capital Land in May issued 3 billion yuan in corporate bonds on the mainland. Instead of raising funds through the bond market, other companies opted to do so on the equity market by placing shares to raise additional funds for expansion.
Alibaba Pictures raised more than HK$12 billion from a share placement that may be used for acquisitions. The shares were placed to at least six independent institutional and/or individual investors at HK$2.90 apiece.


Sogo operator Lifestyle International issues bond to raise US$300 million

Prior to issuance of the latest bond, Sogo department store operator Lifestyle had bond commitments of HK$6.16 billion. Photo: KY Cheng

Business

Banking & Finance

Lifestyle International issues 10-year bonds to raise US$300m to repay debt, fund expansion


New | Sogo operator Lifestyle International issues bond to raise US$300 million

Lifestyle International issues 10-year bonds to raise US$300m to repay debt, fund expansion