GITI Tire Issue Completed

Pricing of GITI Tire’s $200 million secured note concluded a day late on 19 January in Hong Kong. The bond will list in Singapore. Apart from helping its parent, the proceeds are expected to be used for capital expenditure, general corporate purposes and possible acquisition of other tyre businesses.

The final yield is 12.5 basis points inside the final guidance figure of 12.5 per cent, according to specialists and the issue reportedly saw demand just in excess of $1 billion from 125 accounts. Finance Asia quoted one sourced as that the GITI issue is at the higher end of the yield scale.

GITI Tire’s revenue has grown by an impressive 29 per cent CAGR in 2003-2006, according to Moody’s. Total sales in 2005 amounted to Rmb 9.5 billion ($1.23 billion, £619 million).

34.45 per cent of the investment came from Europe, 45.75 per cent from Asia and 19.80 per cent from offshore US accounts. The latter were reportedly mainly hedge funds.

In terms of investor types, the breakdown came in at 17.15 per cent to banks, 73.85 per cent to funds and 9 per cent to private bankers.