Xiaomi Corp US$600m 3.375% 10-Year Senior Bond Offering

On 22nd April 2020, Xiaomi Corporation (1810.HK, “Xiaomi” or the “Company”) successfully priced its debut US$600m 3.375% 10-year senior fixed rate bond offering (the “Transaction”). AMTD acted as a Joint Bookrunner and Joint Lead Manager on the Transaction.

This is the first ever offshore USD offering by Xiaomi and the first 144a/Reg S offering by a Chinese POE in 2020YTD. Xiaomi has obtained full investment-grade ratings from all three international rating agencies, namely Baa2 Stable by Moody’s, BBB- Stable by S&P and BBB Stable by Fitch, which is extremely rare for a Chinese POE. The Transaction also achieved the lowest ever yield for a debut 10 year bond by a Chinese TMT company, as well as having the largest price tightening and the largest oversubscription for a Chinese TMT sector bond issue so far this year.

After collecting solid investor feedback and high-quality anchor orders from 2 days of investor calls, the Company made a decisive decision to undertake a one-day bookbuild and pricing to minimize execution risk. IPG was set at T10+340bps area (c.4% yield) to attract investor attention. Orderbook momentum was strong right from the start and reached US$5.5bn at its peak, amounting to an oversubscription of nearly 9 times. Given the strong orderbook quality, the FPG was tightened to T10+290-295bps, with the final orderbook at US$4.7bn at the time of pricing and eventually priced at the tight end of FPG at T10+290 bps. The final book included 281 global investors, of which 71% were fund managers and asset managers, 17% were banks or other financial institutions, while insurance companies and government related entities accounted for 6% each. In terms of investor geography, 50% were located in Asia-Pacific, 39% were in the US and EMEA accounted for the remaining 11%.

AMTD has established a multi-level cooperative relationship with Xiaomi. This Transaction represents AMTD's second cooperation with the Company in offshore capital markets after the Xiaomi's HK IPO, as well as other cooperations including the establishment of a virtual bank in Hong Kong and potentially in Singapore and other business areas. In July 2018, Xiaomi was successfully listed on the Main Board of Hong Kong Stock Exchange (“HKEX”). It was the first company to list under the new “Weighted Voting Rights” (WVR) scheme, which was the biggest reform in the 25-year history of HKEX serving as a pilot for new economy companies’ listing in Hong Kong. AMTD served as a Joint Lead Underwriter, Joint Bookrunner and Joint Lead Manager of Xiaomi’s IPO. In April 2019, Xiaomi strategically invested in AMTD International (NYSE: HKIB / SGX: HKB), the investment banking platform of AMTD Group, and became one of the strategic shareholder of AMTD International. Dr. Timothy W. Tong, PhD, BBS, JP, CEO of AMTD Foundation was invited to join the board of directors of Xiaomi. AMTD has also repeatedly assisted Xiaomi’s ecosystem member corporates to list in the capital markets of Hong Kong and the United States. AMTD and Xiaomi also jointly established Airstar Bank and obtained one of the only eight virtual banking licenses in Hong Kong, fully leveraging the powerful advantages and resources of Xiaomi in FinTech and AMTD's in-depth knowledge and rich experience in the financial industry and global capital markets. Airstar Bank is one of the first virtual banks to begin operations in Hong Kong. AMTD initiated the application for the establishment of Singapore Digital Bank jointly with Xiaomi, Funding Societies Singapore and Singapore Power, the Temasek-owned utilities company in Singapore; AMTD also established "Singapore Digital Finance Leadership Programme" jointly with Xiaomi, Singapore Management University and National University of Singapore to support the training of innovative financial talents in Singapore and ASEAN.