Company News - 12 April 2017

AMTD completes US$225mm senior perpetual bond for Regal Hotels

On April 6, 2017, Regal Hotels International Holdings Limited (“Regal Hotels” or the “Company”) successfully priced a Reg S US$225mm senior perpetual bond offering (the “Transaction”), with AMTD acting as the Left-Lead Global Coordinator, Bookrunner and Joint Lead Manager. This is one of the few in history and the first time for a Hong Kong-based company to issue a Fixed-for-life perpetual product in the Hong Kong capital market this year. Following its US$350mm bond offering last July (for which AMTD also acted as Left-Lead Global Coordinator, Bookrunner and Joint Lead Manager), the Transaction represents another major debt capital markets financing for Regal Hotels within 9 months, by which the Company has further expanded its presence in the global capital markets and broadened its investor base. The Transaction also marked the second time that AMTD has worked with the Company to complete yet another successful bond offering.

Established since 1979, Regal Hotels is one of the largest hotel operators in Hong Kong and is widely regarded as one of top hotel brands in Asia, with well-known hotel properties such as Regal Airport Hotel, Regal Hong Kong Hotel, Regal Kowloon Hotel and Regal Oriental Hotel etc. Regal Hotels’ Chairman and Chief Executive Officer, Mr. Lo Yuk Sui, is one of the most successful and renowned entrepreneurs in Hong Kong.

Issuer of the Transaction is RH International Finance Limited, a wholly owned SPV, with the Company providing guarantee. The perpetual bond is non-callable in the first 5 years, with coupon rate of 6.5% for the life of the bond (also known as Fixed-for-life). The bonds are unrated and will be listed on the Hong Kong Stock Exchange (HKEx).

Benefited from Regal Hotels’ strong financial performance, solid recurring income as well as its global footprint, coupled with top-class distribution capabilities of the syndicate banks including AMTD, the Transaction was well received by the international capital markets. The final orderbook amounted to over US$650mm or being around 3x oversubscribed as compared to its offering size of US$225mm. On the back of a high-quality orderbook, final pricing for the bonds tightened by 37.5bps from its initial pricing guidance of 6.875% to 6.5%, priced at par.

Once again, as the Lead Global Coordinator, Bookrunner and Joint Lead Manager in the Transaction, AMTD took advantage of the constructive market windows and renewed low rates environment expectation by investors to successfully market the rare Fixed-for-life perpetual product from Asian borrowers, demonstrating its excellent distribution capabilities and solid client base. AMTD took the leading role in the overall execution of the Transaction, in particular, in less than two months’ time, AMTD designed a well-planned investor education and marketing process for this Transaction, and secured significant lead orders prior to the formal announcement of the deal. AMTD also contributed one of the largest orders in the orderbook and was awarded the single largest allocation at the end.

The Transaction represents the 32nd offshore fundraising transaction completed by AMTD over the past 12 months, and the 12th deal within the first four months of the year, demonstrating AMTD’s leadership and influences in the international debt capital markets. AMTD has maintained a long-term relationship with various bond issuers and has repeatedly assisted them to tap the most constructive window in the international debt capital markets. In addition to working with Regal Hotels for the issuance of its senior USD bond and perpetual bond in less than a year’s time, AMTD has repeatedly served multiple Chinese enterprises for their USD bond issuances, including China Minsheng Investment Group, China Huarong Asset Management (2799.HK), HNA Group, Ronshine China (3301.HK) as well as Emperor International Holdings Limited (163.HK).

As a Hong Kong-based comprehensive financial institution, AMTD has long-served multiple enterprises, tycoons and family offices in Hong Kong. These include Mr. Lo Yuk Sui's family-controlled Regal Hotels Group, Mr. Lee Ming Tee's family-controlled Sun Hong Kai & Co., Mr. Albert Yeung's family-controlled Emperor International, Mr. Deacon Chiu's family-owned Far East Consortium International Limited (35.HK), as well as Hong Kong multi-family office L.R. Capital Group.

About Regal Hotels

Established in 1979, Regal Hotels (78.HK) has been listed on the Hong Kong Stock Exchange since 1980 and is one of the largest hotel operators in Hong Kong. Regal Hotels owns a well-established portfolio of hotel properties in Hong Kong, including Regal Airport Hotel, Regal Hong Kong Hotel, Regal Kowloon Hotel and Regal Oriental Hotel, and is regarded as one of top hotel brands in Asia.