Clifford Chance advises on State Grid’s record RMB14.9 billion dim sum bond issuance

Global law firm Clifford Chance has advised ICBC, Bank of China, CITIC Securities, Agricultural Bank of China and Bank of Communications, together with the other joint lead managers, on the successful RMB14.9 billion dim sum bond issuance by State Grid Corporation of China (State Grid) through its wholly-owned offshore subsidiary, State Grid Overseas Investment (BVI) Limited. The transaction is the largest single offshore Renminbi bond issuance by a Chinese state-owned enterprise.

Comprising RMB3.9 billion five-year bonds, RMB7 billion 10-year bonds and RMB4 billion 20-year bonds, the transaction was more than 13 times oversubscribed, with a peak orderbook exceeding RMB193 billion from a broad range of international investors, making it one of the most heavily subscribed issuances seen in the offshore Renminbi bond market.

Partner Fang Liu said, “The scale of this transaction shows how far the offshore Renminbi market has developed. Transactions approaching this size were once largely the preserve of sovereign issuers. Today, the market can support the funding needs of some of China’s largest corporate issuers across longer maturities, backed by substantial investor demand. As the internationalisation of the Renminbi continues, we are proud to support high-quality issuers as they broaden access to global capital through Hong Kong’s capital markets.”

The Clifford Chance team was led by partners Fang Liu and Angela Chan, supported by counsel Torrance Shi, senior associate Michael Cheng, associate Xinyue Yang and trainee solicitor Mark Y Chen.

Clifford Chance has extensive experience advising sovereign and corporate issuers on significant transactions that support the internationalisation of the Renminbi and the development of RMB capital markets. Recent examples include the HKSAR Government’s approximately HK$27.6 billion equivalent multi-currency green and infrastructure bond issuance, which included RMB12 billion tranches, Volkswagen Group on its RMB3 billion panda bond issuance, as well as investment-grade RMB bond issuances for high-credit-quality issuers, such as China Construction Bank, China Merchants Bank and Shanghai Pudong Development Bank.