Huawei Plans $2 Billion Bond Offering
April 20 2016 - 3:44AM
Dow Jones News
By Juro Osawa, Kane Wu and Jasper Moiseiwitsch
Huawei Technologies Co. plans to raise $2 billion by selling a
10-year U.S. dollar-denominated bond, people familiar with the
matter said, as it continues to expand its smartphone business.
The Chinese telecommunications giant, seeking to challenge Apple
Inc. and Samsung Electronics Co. in the global smartphone market,
has been boosting spending on research, marketing and sales.
Huawei is still discussing terms of the issue with banks, and
the size of the deal could change, the people said. Banks likely to
manage the bond issue include DBS Bank, Australia & New Zealand
Banking Group, Standard Chartered Bank and Bank of China, the
people said. The deal could be completed as early as this month,
one of the people said.
In May 2015, Huawei issued a $1 billion 10-year bond, according
to the company. That offering was oversubscribed due to strong
demand, according to bankers.
Among others of China's biggest technology companies making debt
deals recently are social-network company Tencent Holdings
Ltd.--talking with banks about a syndicated loan of as much as $2
billion, people familiar with the matter told The Wall Street
Journal last week--and online shopping company Alibaba Group
Holding Ltd., which last week said it had secured a $3 billion
syndicated loan.
Shenzhen-based Huawei, whose biggest business is supplying
networking equipment such as routers and switches to telecom
carriers, has been growing rapidly as a smartphone brand. Its
global market share in the fourth quarter, 8.1%, trailed only
Samsung's 21% and Apple's 19%, according to research firm IDC.
Earlier this month, Huawei said its net profit last year was up
32% to 36.9 billion yuan ($5.7 billion), while revenue was up 37%
to 395 billion yuan. As of the end of 2015, its balance of cash and
short-term investments amounted to about $19.4 billion, according
to its annual report. The company said its R&D investment last
year jumped 46% to about $9.2 billion.
Write to Juro Osawa at juro.osawa@wsj.com, Kane Wu at
Kane.Wu@wsj.com and Jasper Moiseiwitsch at
jasper.moiseiwitsch@wsj.com
(END) Dow Jones Newswires
April 20, 2016 03:29 ET (07:29 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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