Baidu raises USD 1 billion in ESG bond issue

A statement said 5.5 year tranche bond raised USD 300 million and the 10 year tranche escalated USD 700 million

One of the China's internet giant, Baidu Inc had raised USD 1 billion in a two-tranche, US dollar sustainability bond, its first environment, social and governance (ESG) transaction.


In a statement released by the company which stated that the 5.5 year tranche bond raised USD 300 million and the 10 year tranche escalated USD 700 million.


The statement said that shorter dated bond was priced at US Treasuries plus 83 basis points, whereas the longer dated bond was at US Treasuries plus 113 basis points.


The final price was notably cheap and cheerful for Baidu than when first flagged to investors on Wednesday.


As per to a term sheet reviewed by the news agency, Reuters , the initial price guidance given to investors was US Treasuries plus 115 basis points for the 5.5 year bond whereas the 10-year was US Treasuries plus 150 basis points.


Baidu said that it meant to use the proceeds to pay down debt and fund ESG-related projects within the firm.


According to Dealogic data, the Chinese companies have raised USD 121.2 billion in US dollar debt funding so far in 2021, slightly below the ISD 126.6 billion was raised during the same period previous year.


Last month, China had announced that companies with more than one million customers would have to be reviewed by the Cyberspace Administration of China (CAC) before carrying out listings overseas.


Baidu said in the prospectus, "The draft guidelines remain unclear on whether the relevant requirements will be applicable to companies that have been listed in the United States and intended to conduct further equity or debt offerings."


Baidu said, "We cannot predict the impact of the draft measures.”

India Scanner News Network

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