Airport Authority Prices USD Bonds

14 Feb 2019

The Bonds have not been and will not be registered under the U.S. Securities Act of 1933 (the “Securities Act”) and, subject to certain exceptions, may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons (as defined in Regulation S under the Securities Act (“Regulation S”)). This release is not for distribution, directly or indirectly, in or into the United States or any other jurisdiction in which such distribution would be prohibited by applicable law.

(HONG KONG, 14 February 2019) – Airport Authority Hong Kong (AA) announces that it has successfully priced an offering of US$500 million 3.45% bonds due 2029 (the “Bonds”) under the AA’s Medium Term Note Programme. The proceeds from the Bonds will be used to fund capital expenditure of AA including the Three-Runway System Project and for general corporate purposes. The Bonds are expected to be issued on 21 February 2019, subject to the satisfaction of certain conditions precedent and are expected to be listed on The Stock Exchange of Hong Kong Limited. The Bonds were over-subscribed by more than 7 times, with over US$3.6 billion in orders from professional and institutional investors in Hong Kong, Asia and Europe.

Fred Lam, Chief Executive Officer of the AA said, “The overwhelming response from the global financial community is encouraging and demonstrates the market’s confidence in both the AA and the 3RS project. We are also preparing the issuance of other bonds, including retail bond, for the funding of the 3RS project.”

The construction of the 3RS commenced in August 2016, with target completion in 2024 at a construction cost of HK$141.5 billion in money-of-the-day terms.

The Bonds have been priced with a coupon of 3.45% per annum, payable on a semi-annual basis, and at an issue price of 99.857%, representing a yield to investor of 3.467%, equivalent to a spread of 78 basis points over the 10-year US Government Treasury bond. The Bonds are rated “AA+” by Standard & Poor’s, same as the current credit rating of AA. The Bond investors include a mix of professional investors, including asset managers, government agencies, corporations, banks and insurance companies. The joint lead managers are HSBC and Citigroup.