Li & Fung redeems US$500 million subordinated perpetual capital securities, optimizing its capital structure
Li & Fung Limited (“Li & Fung,” “the Group,” or “the Company;” SEHK: 494), the world’s leading supply chain solutions partner for consumer brands and retailers, today announced it has redeemed its outstanding US$500 million Subordinated Perpetual Capital Securities (“Securities”) issued on 8 November 2012. Following the redemption, the Securities will be cancelled and delisted from the official list of the Singapore Exchange Securities Trading Limited.
Following the completion of the strategic divestment of three product vertical businesses announced on 3 April 2018, the Company realized gross proceeds of US$1,100 million, of which approximately US$520 million will be distributed to shareholders as a special dividend and the remaining US$580 million to further strengthen its financial position and capital structure. The redemption of the US$500 million Securities is part of the capital structure optimization process.
Spencer Fung, Group CEO of Li & Fung, said “We got off a strong start in 2017 when we announced our Three-Year Plan (2017 – 2019), and we are excited about the progress we made on our speed, innovation and digitalization efforts. The redemption shows our commitment to take a conservative approach in maintaining a strong balance sheet and capital structure, which will further support our Three-Year Plan in creating the supply chain of the future to help our customers navigate the digital economy and enable us to deliver long-term shareholder value.”
As of the date of this announcement, the Company’s credit rating remains Baa1 according to Moody’s and BBB+ according to Standard & Poor’s.