News

DeHeng Advised PowerChina Factoring on the Issuance

of Supply Chain Financing ABS Series 1-18

2020-06-28


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On June 18, 2020, PowerChina Factoring Co., Ltd. registered the Supply Chain Financing Asset-Backed Securities (ABS) Series 1-18 Program with Shanghai Stock Exchange, to raise no more than RMB 5 billion in no more 18 series. The original equity holder is PowerChina Factoring Co., Ltd. ("PowerChina Factoring"), and the program has multiple managers: BOC International (China) Co.,Ltd., Shanghai Guotai Junan Securities Asset Management Co., Ltd., China International Capital Corporation Limited, Ping'an Securities Co., Ltd.. The deficiency payment commitment is made by Power Construction Corporation of China, Ltd ("PowerChina") or Power Construction Corporation of China (Power Construction).   


The program covers two issuance models, including ABS for PowerChina financing assets and for agency supply chain. PowerChina Factoring can meet different demands of member enterprises for supply-chain products more quickly, thus facilitating the close combination of efficient issuance and cost reduction and efficiency improvement. In addition, both PowerChina and Power Construction can enhance the credit of the program so that their affiliated companies can satisfy their supply-chain financing demand under one shelf offering. 


The successful registration of this program will help consolidate the brand image of PowerChina Factoring in the capital market and provide a strong guarantee for optimizing the financing structure of member enterprises, expanding their operating cash flow, extending the payment period for them, and strengthening PowerChina Factoring's performance in asset securitization. 


As the legal counsel, the DeHeng team, led by partner Tan Kunlun and lawyer Qi Xin, with primary support from lawyer Ma Quan and paralegal Ma Sitao, provided whole-process legal services for the client, including the design and demonstration of the deal structure, the drafting and revision of the deal documents, and the issuance of final legal opinions. They worked closely with and won high praises from the issuer and other intermediary agencies. They will continue to communicate with the issuer and other intermediary agencies in depth to provide ongoing legal services for future cooperation projects.

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