CBI member London Taxi Company (LTC) announced that Zhejiang Geely Holding Group priced the first-ever green bond on the offshore market from a Chinese automobile company, raising US$400 million to support the development of zero-emission capable vehicles by its U.K. subsidiary, LTC, manufacturer of the iconic London Black Cab.
The senior unsecured bonds, issued through Zhejiang Geely’s wholly-owned subsidiary LTC GB Ltd., carry a fixed interest rate of 2.75% per annum with a tenor of five years, which is the lowest coupon ever amongst the USD bonds issued by Greater China’s auto companies.
The final order book of over US$2.3 billion represented an oversubscription ratio of close to six times. Zhejiang Geely will use the net proceeds from the green bond to finance or refinance the design, development, and production of zero-emission capable vehicles by LTC.
Zhejiang Geely is investing £300 million in LTC’s new research and production facility in Ansty in the West Midlands to develop the next-generation London taxi, the TX5. The new model was unveiled last October in London in the presence of President Xi Jinping during his state visit to the U.K.
The TX5 is a zero-emission capable vehicle and will be launched in the U.K. at the end of 2017 and in international markets in 2018. The vehicle will hence be compliant with new environmental requirements being introduced in London.
LTC is also working on several zero-emission model concepts, including light commercial vehicles as part of Zhejiang Geely’s plans to significantly raise production at LTC and position it as a leading manufacturer of green and environmentally friendly transportation.
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