Sinopec Said to Plan $3 Billion Bond Offering to Refinance Debtby
China Petroleum & Chemical Corp., which owns China’s largest oil refiner, is planning to sell $3 billion of bonds in four parts to refinance debt, according to a person with knowledge of the matter.
The biggest portion of the financing for the state-owned energy company known as Sinopec Group will be $1 billion of three-year bonds that may yield 1.2 percentage points more than similar-maturity U.S. Treasuries, said the person, who asked not to be identified because the information is private. The longest part would be $400 million of 30-year bonds that may yield 4.25 percent.
Despite low oil prices Sinopec will benefit from its “very high strategic importance to China as the country’s largest refiner in terms of crude distillation capacity,” according to a note published Monday by Moody’s Investors Service. The ratings company graded the notes Aa3, the fourth-highest ranking.
Yields on dollar bonds sold by high-grade Asian borrowers have fallen from a more than two-year high of 3.6 percent in December to 3.12 percent, Bank of America Merrill Lynch indexes show.