Press releases

Hong Kong, 1 November 2012 – Hong Kong-based Li & Fung Limited (“Li & Fung”, or “the Company”, SEHK: 494), the multinational consumer goods sourcing, distribution, and logistics group, today announced that it plans to issue perpetual subordinated capital securities in benchmark size (“the Securities”).

Funds will be deployed for strategic acquisitions and business development, which enables the Company to be well positioned to take advantage of present shifts in the global economy and in consumer trends to capture new growth opportunities geographically, particularly in Asia and especially in China.

The Securities, which will be subordinated obligations of the Company, will be denominated in U.S. dollars, will not have a maturity date and will confer a right to receive distributions, subject to the Company’s option to defer distributions in certain circumstances. Approval-in-principle has been obtained from the Singapore Stock Exchange for the listing of the Securities.

The transaction will be arranged by Citigroup and HSBC and the Securities will be placed with investors in Asia and Europe.

Moody’s Investors Service, Inc. has maintained the Corporate rating of A3 and Stable Outlook and assigned the Securities a rating of Baa2. Standard & Poor’s Rating Services has maintained the Corporate rating of A- and changed the Outlook to Negative and assigned the Securities a rating of BBB. The Securities will receive 50% equity treatment from Moody’s and Standard & Poor’s and the proposed issuance forms part of the Company’s strategy and commitment to its credit ratings.

The Securities will be classified as equity in accordance with Hong Kong Financial Reporting Standards. Payments to Securities holders will be recorded as a distribution similar to dividend to ordinary shareholders rather than an interest expense.

Download the press release