China’s Tencent raises its biggest ever dollar loan of $6.5b

FILE PHOTO: WeChat mascots are displayed inside Tencent office at the TIT Creativity Industry Zone in Guangzhou, China May 9, 2017. REUTERS/Bobby Yip/File Photo

Tencent Holdings Ltd.has signed its biggest and cheapest ever dollar-denominated facility in the loan market, according to people familiar with the matter.

The Chinese social media giant’s $6.5 billion loan is the largest versus local peers Alibaba Group Holdings Ltd. and Baidu Inc., Bloomberg-compiled data show. The five-year facility pays an all-in pricing of 85 basis points via an interest margin of 80 basis points over Libor, said the people who are not authorized to speak publicly and asked not to be identified. The rate is also the lowest among its peers, according to data.

The club loan, which will be used for refinancing and general corporate purposes, drew nine lenders including Bank of America Corp. and Bank of China Hong Kong Ltd., the people said. The company was in talks for a $5 billion deal, Bloomberg earlier reported. Tencent didn’t immediately respond to an email request for comment.

Tencent’s facility is seen as a litmus test of lender appetite for high-grade companies in the wake of lower borrowing costs in Asia and political unrest gripping Hong Kong. Syndicated loan volume so far this year in the region excluding Japan is the lowest since 2013 while interest margins are at 2017 lows as of end-June, data compiled by Bloomberg show.

The leading gaming company posted quarterly revenue of 88.8 billion yuan ($12.4 billion), lagging the 93.4 billion yuan average estimate and spurring several analysts to cut price targets on the company. The disappointing growth came after rivals like ByteDance Inc. and a broader economic slowdown sapped advertising.

Bloomberg

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.