Clifford Chance advises on first issuance of foreign currency-denominated bonds in the Shanghai Free-Trade Zone

Leading international law firm Clifford Chance has advised CMB International as sole global coordinator on the first issuance of foreign currency-denominated bonds in the China (Shanghai) Pilot Free-Trade Zone (Shanghai FTZ).

The issuance of US$66 million 2.6% bonds due 2024 by Hong Kong-incorporated GLP China Holdings Limited, the largest owner and operator of modern logistics facilities in China, is also the first Shanghai FTZ bond issued by a non-PRC incorporated entity.

The first-of-its-kind Shanghai FTZ bonds provide companies seeking funding with the option to tap both the onshore and offshore capital markets, and with the ability to remit the US dollar denominated bond proceeds out of the Shanghai FTZ without specific restrictions. With the bonds’ denomination in US dollars and governance under English law, the issuance also represents another step in the harmonisation of China’s domestic and offshore bond markets for institutional investors.

Partner David Tsai who led on the deal said, “We are proud to advise on this pilot deal, which highlights the work of our market-leading capital markets practice on the most innovative and complex deals. The success of this issuance will not only open the doors to foreign companies with similar funding needs, but also give more confidence to institutional investors who have PRC-related investments and portfolios.”

David was supported by senior associate Nicholas Mai, associate Catherine Ho and trainee Kin Kan Chan. Jingtian & Gongcheng advised on PRC law.