Apr 11, 2024
China Cinda Is Said to Plan Up to $800 Million Bond Sale
, Bloomberg News
(Bloomberg) -- China Cinda Asset Management Co. is planning to raise between $500 million and $800 million via a five-year bond offering, said people familiar with the matter.
The bad-debt manager, which is one of China’s biggest, plans to market the bond as early as May, the people said, asking not to be identified as the matter is private. The bond is likely to be issued by Cinda’s offshore subsidiary, China Cinda 2020 I Management Ltd., and guaranteed by China Cinda (HK) Holdings Co., according to the people. Details of the bond offering are still in discussion and subject to change.
China Cinda last issued a $400 million bond in August at a coupon of 5.75%. The upcoming offering comes after Cinda reported net income of 5.8 billion yuan ($802 million) for 2023, down 7.8% from the previous year.
Calls to the secretary of Cinda’s board of directors went unanswered and the company’s investor relations department didn’t immediately reply to an email seeking comment.
Cinda is one of four state-controlled entities set up by China’s government in 1999 to help clean up a banking system riddled with bad debt. These financial companies eventually expanded beyond their original mandate, creating a labyrinth of subsidiaries to engage in other financial businesses and borrow billions from the bond market.
Global ratings firms Moody’s Investors Service and Fitch Ratings downgraded Cinda’s corporate ratings earlier this year. Among the ratings firms’ main concerns were continued risks in the property market as well as worries over China’s economy and expectations of reduced government support. China’s Ministry of Finance holds a controlling stake in Cinda.
In January, the official Xinhua News Agency reported that Cinda, China Orient Asset Management Co. and China Great Wall Asset Management Co. would be “merged” into the country’s sovereign wealth fund, as part of the country’s plans for institutional reform. The report was then deleted by Xinhua without elaboration.
--With assistance from Zhang Dingmin.
©2024 Bloomberg L.P.
