China Loan House: Standard Chartered

IFR Asia Awards 2019
3 min read
Apple Li

Risk taker

In a challenging year under the shadow of the US-China trade war, Standard Chartered stood out from its peers for its ability to underwrite and distribute risk, work with debut borrowers and react quickly to new trends.

Despite fierce competition from Chinese relationship banks, StanChart managed to win a sole mandate as the bookrunner and underwriter of a US$500m loan backing’s acquisition of Carrefour’s business in China.

The bank also took an active part in other landmark acquisition-related financings, including the jumbo €2.2bn (US$2.4bn) five-year recourse loan backing the buyout of Amer Sports by a consortium led by Anta Sports, in one of the most high-profile outbound M&A transactions in the year.

In June, StanChart completed, along with five other leads banks, a €1.4bn term loan which refinanced two bridge facilities that backed carmaker Zhejiang Geely Holding Group’s previous acquisitions in Europe.

“The market backdrop this year has been challenging, impacted by trade tensions, concerns about slower economic growth in China and many borrowers prioritising bond issuance,” said Julia Chou, head of loan syndications for Greater China and North Asia. “We targeted our origination efforts at new and growing industries, introducing a number of debut borrower names to the market in 2019 and were quick to identify emerging market themes. All of these initiatives served us well and allowed us to stay busy throughout the year.”

Financial sponsors emerged as major buyers in the real estate sector in 2019, and StanChart again took a leading role, notably as the global coordinator of an offshore US$500m loan backing Partners Group’s purchase of a majority stake in Dinghao Plaza, a commercial complex in Beijing. StanChart took a bold underwriting position, despite the lack of rental income during a large-scale refurbishment, and successfully attracted seven lenders in syndication.

The bank continued to engage with new borrowers and led 19 debut syndicated transactions in 12 diverse industries during the review period.

In June, StanChart closed a debut HK$2.3bn three-year loan for Shanghai-listed Juneyao Airlines. The loan was increased from an original HK$1.8bn target after an overwhelming response from 17 Chinese and international lenders in general syndication.

It was one of two leads on a three-year term loan for biopharmaceutical company Wuxi Biologic (Cayman), increasing the deal size to US$300m from US$200m after attracting 15 banks in syndication.

Other first-time borrowers included state-owned Beijing Hainachuan Automotive Parts, electric motor maker Wolong Electric Group and steel producer Jiangsu Shagang Group.

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