ZTE secures USD900 mn loan for overseas expansion

ZTE has entered into an agreement for a USD900 million for a period of three to five years syndicated term loan with 10 leading international banks namely Bank of China (Hong Kong) Limited, DBS Bank, United Overseas Bank, Banco Santander, S.A., Hong Kong Branch, The Bank of Tokyo-Mitsubishi UFJ, Natixis, Hang Seng Bank, Maybank, Hong Kong Branch, China Construction Bank Corporation, Hong Kong Branch and the Bank of Nova Scotia, said a release.

The loan will be guaranteed by ZTE and will be used for the general working capital requirements of ZTE (H.K.). Raising the debt in US dollars is an effective way for ZTE to hedge against the appreciation of RMB.ZTE's financing offer received significant support from 10 international banks and was more than two times over-subscribed from the initial target. This level of support clearly demonstrates ZTE's established strength and good prospects.

ZTE, executive VP and CFO, Wei Zaisheng, said, "We are very encouraged by the response to our first large-scale syndicated loan, which demonstrates strong support for ZTE's financial stability and future growth prospects. Hong Kong is an international financial center that offers a platform to attract investment and funds from around the globe and ZTE will continue to build more solid partnerships with Hong Kong's leading international banks, to assist all-round co-operation for future overseas market opportunities.”

Wei added, “More than half of ZTE's business is now focused on overseas projects, so having this debt measured in US dollars places us in a better position to respond to the challenges of RMB appreciation. Loans from overseas syndicates can also reduce ZTE's operating costs by avoiding rising domestic interest rates. In addition, this loan supports ZTE's goal to optimize the company's short and long term credit structure and currency composition of debt.”