CICC Facilitates CGA’s $400M Senior Perpetual Notes Offering

CICC, acting as Joint Global Coordinator and Bookrunner, successfully assisted China Grand Automotive Services Co., Ltd. (“CGA” or the “Company”, B1Moody / BB- Fitch both stable outlook, B+ Fitch Issue Rating) to complete its bond issuance of its USD 400 million senior perpetual securities (non-callable in first 3 years) on October 24th, 2017. Since its debut offshore issuance in November 2016, which CICC acted as Sole Global Coordinator, this is the second offshore bond issuance by CGA. This landmark transaction was well-received in the markets which lead to significant pricing advantages and high client satisfaction.

With the successful completion of the 19th CPC National Congress and the announcement of the USD sovereign bond by the Ministry of Finance of the PRC, CGA has grasped the optimal issuance window to announce to the market. The market sentiment was optimistic with global focus to the future development in Chinese corporates, and this showed immediate impact when the book-building started the day after announcement. Within the first hour after the book open, the transaction received overwhelming demand with orders exceeding US$1.0 Billion, the order momentum grew continuously throughout the day. In the end, the bond was priced at 5.625% with 37.5bps lower than the initial price guidance of 6.000% area. CICC has made significant contribution to the success of this offering to arrange high-quality investor meetings before the launch which resulted in many cornerstone investor orders. The final order book was worth over US$2.7 Billion from 143 accounts, with more than 7x coverage to issue size. The transaction was a complete success and the secondary market performed outstandingly on the second day post issuance.

CGA is a leading passenger vehicle dealership and automobile services group covering the entire lifecycle of automobile services, including vehicle sales, maintenance and repair, commission-based agency services and vehicle leasing, etc. In June 2015, the Company successfully completed a backdoor listing on the Shanghai Stock Exchange, and in June 2016, CGA completed the tender offer for 75% of the total shares to Baoxin Auto, an H-share listed company, and became the single largest shareholder of Baoxin Auto (1293.HK). This resulted in a strategic expansion for CGA to gain both H-share and A-share listing position. In December 2016, the Company was included in the list of constituent stocks of SSE 180 Index and SSE 380 Index, and in 2017, CGA was included in the MSCI Index as the only vehicle dealership company in the category.

As of June 30, 2017, CGA’s total asset has reached USD$113.8 Billion, with operation in the 754 branches covering 28 provinces, cities, and autonomous regions in China, and with over 57 brands of passenger vehicles such as Benz, BMW, Audi, Jaguar Land Rover, Buick, and Volkswagen in their dealerships.

CICC, acting as Joint Global Coordinator in the transaction, is responsible for leading all the execution work including bond rating, regulatory approval, due diligence, roadshow arrangements and marketing strategies,. Based on the rich execution experience and comprehensive financial service capabilities, CICC’s contributions were greatly praised and recognized by the Company; this transaction, once again, proves CICC’s leading status as the top all-around investment bank in the international fixed-income capital market.