Cheung Kong (Holdings) Ltd., controlled by Hong Kong’s richest man Li Ka-shing, is marketing the first Hong Kong-dollar perpetual bond for a non-financial company, according to data compiled by Bloomberg and a person familiar with the matter.
The developer, which led the industry in Hong Kong with the most homes sold last year, is planning to offer the note at 5.125 percent to 5.375 percent, said the person, who asked not to be identified because the matter is private. The coupon will increase by 1 percentage point after five years, the person said.
Cheung Kong last sold a bond in the currency in November raising HK$300 million ($39 million) in 3.35 percent 10-year notes through its subsidiary Cheung Kong Finance MTN Ltd., according to data compiled by Bloomberg.
Winnie Cheong, a Hong Kong-based spokeswoman for Cheung Kong, didn’t immediately answer calls today seeking comment on the sale.
This will be the fifth perpetual bond issued by Cheung Kong and its units including Hutchison Whampoa Ltd., a diversified company with interests in ports, telecommunications and retail. Hutchison, controlled by Li, has issued the equivalent of $6 billion of debt this year, including $1 billion of perpetual notes in May with a 6 percent coupon and $2.5 billion of securities in January split into 10- and five-year tenors.
A perpetual bond has no fixed maturity and no principal repayment, and generally pays a higher yield.