Caterpillar, the US-based manufacturer of earth-moving equipment, is marketing a two-year Rmb1bn bond to institutional investors in Hong Kong, becoming the first foreign industrial multinational to issue debt in the Chinese currency.
The issue, which is only the second by a multinational to date, dwarfs a Rmb200m issue launched by McDonald’s in August. The deal will give momentum to the nascent offshore market in renminbi-denominated debt which financiers hope will become an important fundraising route for companies with operations in China.
The interest rate on Caterpillar’s corporate bond will be determined according to interest from Wednesday’s marketing effort. McDonald’s three-year note was quickly oversubscribed and secured a 3 per cent coupon.