HOTELS Clarification

Last week, HOTELS posted an article about The Hongkong and Shanghai Hotels Ltd. acquiring a credit facility valued at US$158 million. That article was based on a press release issued by the company in 2009, and thus the information in the article was outdated. HOTELS regrets the error.

Below is the article as published, which remains factually correct.

The Hongkong and Shanghai Hotels Ltd., parent company of The Peninsula Hotels, has signed a HK$1.225 billion (US$158 million) four-year term loan facility with a group of seven international banks. The funds will be used to refinance existing debt and for general corporate purposes.

The facility, which matures in 2013, is guaranteed by HSH. Terms and the interest rates have not been disclosed. The facility is paying a credit margin of 150 basis points.

The banking consortium includes Australia and New Zealand Banking Group Ltd., Bank of China (Hong Kong) Ltd., The Bank of Tokyo-Mitsubishi UFJ Ltd., Calyon, HSBC, Industrial and Commercial Bank of China (Asia) Ltd. and Standard Chartered Bank (Hong Kong) Ltd.

The original target was to raise HK$1 billion, but with demand from banks exceeding HK$3 billion, HSH opted to increase the loan size to HK$1.225 billion, with each of the lenders holding HK$175 million, says Hongkong and Shanghai CFO Neil Galloway. “This is the first time for several years that HSH has come to market in Hong Kong, and our financing has met with a very strong response from the bank market,” Galloway says.

The credit facility will help Hongkong and Shanghai meet a number of corporate objectives, including stretching its maturity profile and introducing long-term funding while bringing new lenders into the fold. “The response highlights market confidence in HSH and further strengthens our financial position to take advantage of opportunities as they arise in the current environment,” Galloway says.

The company’s hotel portfolio is composed of The Peninsula Hong Kong, The Peninsula New York, The Peninsula Chicago, The Peninsula Beverly Hills, The Peninsula Tokyo, The Peninsula Bangkok, The Peninsula Beijing, The Peninsula Manila, The Peninsula Shanghai and Quail Lodge Resort and Golf Club in Carmel, California.