Access to Capital

We leverage our deep relationships with global investors to provide corporates access to liquidity.

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Andrew Low, Head of Corporate Finance & Capital Markets at CITIC CLSA Securities shares his 2016 outlook on Chinese outbound investment.

One of the biggest trends of 2016 has been the continued growth of Chinese outward investment. Companies in China have progressively increased the capital invested in international markets from negligible annual amounts before 2000 to the point that last year there was US$65 billion invested in over 380 M&A deals. In the first half of 2016 there has already been US$134 billion invested in more than 490 deals and according to PwC, the full-year deal value is expected to be more than three times the previous record set in 2015.

Not only has the scale increased, but Chinese interest in offshore assets has become more sophisticated.

In the past, many Chinese investors conducted limited due diligence on assets, often neglecting to either use qualified financial advisers or understand and manage relationships with local regulators and influencers. As a result, many of these deals proved to be unsuccessful and substantial amounts of capital had to be written off. These days, most Chinese buyers are more sophisticated in how they invest offshore. They now seek professional advisory services and consider the local issues in the relevant market to make sure that regulations and risk issues are taken into account in their long-term strategies. Increasingly, we find Chinese buyers focusing on specific assets and businesses that have real strategic value, especially where a brand, technology or product capability can be taken back to China and used to drive stronger growth or improve competitive positioning.

Since CITIC Securities International and CLSA integrated their ECM, DCM and M&A businesses outside of mainland China into CITIC CLSA Securities in May 2015, it has become clear that we are in a unique position to cover all the local, Chinese and international aspects of a deal with a single seamless team.

Creating Value

We are focused on long term value creation.

Our priority is to ensure sustainable and long term value creation for our clients. For more than two decades we have advised companies, governments, insurers and investors seeking access to capital markets, restructuring and pursuing strategic investment opportunities. We have worked on numerous, significant capital raising and M&A deals across Asia, helping companies to reach their strategic goals.

Oceanwide Holdings

We helped Oceanwide Holdings, one of the first listed real estate companies in China and a member of the CSI 300 Index, issue offshore high yield USD bonds to aid its transformation into a moderately diversified enterprise.

The transaction is among the rare successful high yield issuances in the offshore market in 2016 and was over two times subscribed. CITIC CLSA Securities assisted with NDRC registration process, book building and preparing the leading documentation. Our outstanding coordination, execution, and book building capabilities ensured the deal was well received by the market, further proving our strong name in the debt capital markets.

Details: Offshore USD Senior Guaranteed Notes (retap) for Oceanwide Holdings in May 2016

Deal Size: US$200 million 5-year tenured bonds, puttable after 3-years with a yield to maturity of 7.50% and an Issue Price of 107.528%

Role: Joint Global Coordinator, Joint Lead Manager and Joint Bookrunner

3SBio Inc.

When a leading biotechnology company in China decided to IPO, they turned to CITIC CLSA Securities to help them fulfil their capital raising requirements. Working closely with the management team of 3SBio, we assessed the company’s capital requirements based on their long-term growth strategy and more immediate financing needs.

A decision was made to seek corner stone investors for 25% of the shares on offer. CITIC CLSA Capital scheduled a seven-day roadshow in Hong Kong, Singapore, London, Boston and New York to introduce 3SBio to global investors. The share offering attracted considerable attention from institutional investors, corporates and high net worth investors. The International tranche was significantly over-subscribed and the Initial Public Offer in Hong Kong was over 200x oversubscribed, pricing at the high-end of the range.

Details: IPO of 3SBio Inc. (1530.HK) listed on the Main Board of The Stock Exchange of Hong Kong Limited on 11 June, 2015

Deal Size: US$711.6 million (~HK$5,515.5 million, pre-shoe)

Role: Joint Sponsor, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager

Indiabulls Housing Finance Limited

We assisted one of India’s leading housing finance companies to raise US$600 million. Through our help, Indiabulls Housing successfully raised funds in order to maintain its strong capital adequacy ratio as well as for general corporate purposes.

The issue was priced at INR 702 per Equity Share and saw strong demand from high quality funds across the US, Asia-Pacific, and UK. Consisting predominantly of Long Only funds, the book was covered over 1.5x at the base size.

Details: QIP Issue for Indiabulls Housing Finance Limited in September 2015

Deal Size: US$600 million raised through a primary issuance of 56.9 million equity shares at INR 702 per equity share

Role: Global Coordinator and Bookrunner

China

Unparalleled access to China.

With significant presence and local connections in China, our parent company CITIC Securities provides local background, innate knowledge of China’s regulatory framework and comprehensive understanding of developments within all major industries across the country.

As the international arm of CITIC Securities’ global investment banking business, CITIC CLSA Securities leverages the breadth and deep relationships of 400+ bankers at China’s largest investment bank and is the ideal partner for Chinese companies aspiring to invest overseas, as well as foreign companies seeking Chinese capital for growth and expansion.

China, being one of the fastest-growing markets globally, continues to develop its domestic market, upgrade infrastructure and revive transcontinental trading routes via its Belt and Road initiative. With a considerable amount of capital expected to exit the country, along with foreign capital investments into China, CITIC CLSA Securities is best placed to capture the mass of capital inflows and outflows that China will be dominating over the next couple of decades.

CITIC CLSA Securities is in an inimitable position due to its extensive on-the-ground contacts, which multi-national investment banks do not typically have, together with established relationships within the global investment community, rarely accessible by local Chinese securities firms.

Deals

CITIC CLSA Securities is a market leader in equity and debt capital markets and has completed a number of significant ECM, DCM and M&A deals across the region:
 

Equity Capital Markets

  • China Development Bank Financial Leasing Co. Ltd. – Joint Sponsor, Joint Global Coordinator, Joint Bookrunner of US$800 million IPO (2016)
  • CITIC Securities – Sole Global Coordinator, Sole Placing Agent of US$3,490 million New Shares Placement (2015)
  • Indiabulls Housing Finance Ltd. – Global Coordinator, Bookrunner for QIP Issue of US$600 million (2015)

Debt Capital Markets

  • Bank of China Ltd. – Joint Bookrunner and Joint Lead Manager for first and largest offshore additional tier one capital offering by a Chinese bank (2014)
  • CITIC Ltd. – Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager for jumbo USD bond offering by CITIC Ltd., China’s largest conglomerate (2016)
  • Oceanwide Co., Ltd. – Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager for all high yield bond offerings by leading Chinese real estate developer (2016, 2015 & 2014)

Mergers & Acquisitions

  • China Orient Asset Management (International) Holding Ltd. – Sole Financial Advisor on the acquisition of 50.03% stake in Shanghai Zendai Property Ltd. (2015)
  • Integrated Clinical Oncology Network Pty Ltd. – Financial Advisor on the landmark acquisition of Singapore Oncology (2016)
  • Security Bank Corporation – Sole Financial Advisor on the sale of a 20% stake to Bank of Tokyo-Mitsubishi UFJ (2016)