eHi Car’s 2022 Bonds Fall Most on Record After Buyout Offer
The Chinese car rental service provider’s $400m 5.875% 2022 note dropped about 1.2 cents on the dollar to 101.4 cents, according to Bloomberg-compiled prices, after the U.S.-listed firm said Monday it received an acquisition offer.
eHi Car Services gets preliminary non-binding proposal letter from Goliath Advisors, a third party China-based investment fund, to buy the company at $13.35 per ADR.
“The development is credit-negative because the buyer, being a financial investor, is likely to leverage up eHi’s balance sheet to increase shareholders’ return,” according to a note on Tuesday from Lucror.
“While noteholders are somewhat protected by the change-of- control (CoC) put, the CoC put price of 101 is lower than the market prices of both the 2018 and 2022 notes”.
Lucror revises its credit bias on eHi’s 2022 notes and its 2018 notes to stable from positive
November 28, 2017, 01:58:49 GMT
By Lianting Tu; Edited by Neha D'silva and Finbarr Flynn