The HK$2.5bn (US$322m) loan used by private equity firm CVC Capital Partners for its acquisition of Hong Kong-based City Telecom has attracted 11 banks in senior syndication, according to an IFR report.
JP Morgan and Standard Chartered, the original…
The HK$2.5bn (US$322m) loan used by private equity firm CVC Capital Partners for its acquisition of Hong Kong-based City Telecom has attracted 11 banks in senior syndication, according to an IFR report.
JP Morgan and Standard Chartered, the original MLAs and underwriters, have reportedly been joined by BNP Paribas, Credit Agricole, Chinatrust Commercial Bank, DBS Bank, GE Commercial Finance, ING, Mizuho, Natixis, SMBC, Taipei Fubon Commercial Bank, and UOB.
The five-year loan pays a margin of approximately 400bp over Libor, wrote IFR.
In late May, Metropolitan Light Company, an affiliate of CVC, completed the purchase of the telecoms units of City Telecom for HK$5.012bn (US$645.5m).
The sale of these units, which include broadband internet and long-distance phone services, allows City to focus on its television broadcast operations.
To pay for the assets, Metropolitan received equity funding worth HK$2.65bn (US$340.8m) from CVC Asia Pacific and debt commitments in the amount of HK$2.5bn from JP Morgan and Standard Chartered.
Proceeds from the transaction are expected to be partly returned to City’s shareholders via a special dividend of approximately HK$2bn (US$258m), or HK$2.50 per share.
The remainder of the proceeds “will be retained to fund the continuing development and expansion of the multimedia business,” City Telecom stated in a notice to the Hong Kong Stock Exchange in mid-April.
