Franshion copies perpetual deal pioneered by Sino-Ocean

The Chinese real estate developer raises $500 million from a private placement of perpetual convertible securities that could be called in five years.

Hong Kong-listed Franshion Properties China has raised $500 million from an issue of perpetual subordinated convertible securities that were structured almost exactly like a similar perpetual deal sold by fellow Chinese real estate developer Sino-Ocean Land Holdings in mid-July.

Indeed, sources said the mandate to the arranging banks was to achieve the same accounting treatment as Sino-Ocean did on its $900 million offering, in other words to have the securities treated as equity on the balance sheet from day one. From an accounting perspective, convertible bonds are otherwise treated as debt until conversion. After that they become equity.

For Franshion, which has a market cap of about $2.4 billion, this means a substantial increase in...

¬ Haymarket Media Limited. All rights reserved.

FinanceAsia has updated its subscription model.

Registered readers now have the opportunity to read 5 articles from our award-winning website for free.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team (2-10 users), or office-wide licences.

To help you and your colleagues access our proprietary content, please contact us at subscriptions@financeasia.com, or +(852) 2122 5222

Article limit is reached.

Hello! You have used up all of your free articles on FinanceAsia.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team (2-10 users), or office-wide licences. To help you and your colleagues access our proprietary content, please contact us at subscriptions@financeasia.com, or +(852) 2122 5222