Tencent bond debut

Tencent makes less-than-stellar bond debut

The Chinese internet firm's bonds widen in secondary markets despite strong US participation, with investors concerned over the "variable interest entity" structure.
<div style="text-align: left;"> Tencent showgirls at ChinaJoy 2011 in Shanghai (ImagineChina)</div>
<div style="text-align: left;"> Tencent showgirls at ChinaJoy 2011 in Shanghai (ImagineChina)</div>
December 06, 2011

Chinese internet portal firm Tencent Holdings priced a $600 million maiden bond offering early Tuesday morning, making it the first internet company outside the US to sell a dollar bond. The five-year bonds priced at Treasuries plus 375bp, at the tight end of the Treasuries plus 375bp to 387.5bp guidance.

Goldman Sachs and Deutsche Bank were joint global coordinators and bookrunners. Credit Suisse and HSBC were also joint bookrunners. ANZ, Barclays Capital and Citi were co-managers.

Tencent is a debut borrower, which did not make it an obvious candidate to tap the bond markets amid rocky conditions. However, the company counts a few ex-Goldman employees among...

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