Tencent Said to Pick Five Banks to Underwrite $1.5 Billion Loan

  • Internet company is expanding beyond social media and games
  • Shenzhen-based company last in loan market in May 2014

Tencent Holdings Ltd. has selected five banks to underwrite a $1.5 billion five-year syndicated loan, according to people familiar with the matter, as the Chinese company bankrolls an expansion into online services and entertainment.

The company picked Australia & New Zealand Banking Group Ltd., Bank of China Ltd., Citigroup Inc., HSBC Holdings Plc and Mizuho Bank Ltd. to lead a facility split between a term loan and a revolver, according to the people, who asked not to be identified because they weren’t authorized to speak publicly.

Canny Lo, a spokeswoman for Shenzhen-based Tencent, declined to comment in an e-mail.

Tencent, which counts more than 1 billion users for its messaging services WeChat and QQ, was last in the loan market in May 2014 for a $200 million, five-year facility. That facility, its debut in the syndicated loan market, paid a margin of 151 basis points more than the London interbank offered rate.

Tencent reports quarterly results Tuesday. The company founded by Ma Huateng is riding a wave of advertising growth through its games and social media platforms and is now seeking new sources of revenue from services such as streaming entertainment and online commerce.

The details of the syndicated loan were first reported by the Wall Street Journal.

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