How Chinese Companies Finance Overseas M&A

March 5th, 2017 Posted by Capital Markets, China Business Development, M&A No Comment yet

Wall Street Journal reporter Anjani Trevedi takes a closer look at how China’s HNA Group, a recent buyer of stakes in Hilton Worldwide Holdings, Skybridge Capital, and a host of other assets, has used credit-enhanced debt offerings to deploy capital overseas. In a typical transaction, a Chinese bank will provide standby letters of credit to back loans issued by Chinese buyers. The credit line, which is in turn backed by RMB cash deposits in China, is then used as collateral by the buyer to borrow USD offshore.

Read the WSJ article here.


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