Vontobel Limited Issues CBBCs Linked to Xiaomi, Alibaba, Great Wall Motor, and Semiconductor Manufacturing International Corp.

Strategic Insights -

Vontobel Limited has issued a series of complex debt securities, known as call bearer bonds with customized benefits (CBBCs), linked to the performance of four major tech and automotive companies: Xiaomi Corporation, Alibaba Group Holding Ltd., Great Wall Motor Company Limited, and Semiconductor Manufacturing International Corp. The CBBCs are designed to provide investors with exposure to the upside of these companies' stock prices, with the potential for substantial returns if the underlying stocks perform well.

Key Takeaways:

  • Four companies are linked to the CBBCs: Xiaomi Corporation, Alibaba Group Holding Ltd., Great Wall Motor Company Limited, and Semiconductor Manufacturing International Corp.
  • The issue size for each CBBC series is 100 million, 60 million, 60 million, and 60 million CBBCs, respectively.
  • The CBBCs are structured as European style cash settled category R, with a bull and bear component for each series.
  • The issue price for each CBBC is HK$0.250, with a funding cost as of HK$0.21020, HK$0.23960, HK$0.12280, and HK$0.22400 for each series.
  • The CBBCs have different expiry dates, ranging from 26 November 2021 to 30 December 2021.
  • The settlement date for all series will be the third CCASS settlement day after the end of the MCE valuation period or the later of the expiry date and the day on which the closing price is determined.
  • The effective gearing for each CBBC series is 2.09x, 1.76x, 1.49x, and 1.90x, respectively.

Statistics:

  • Issue size: 100 million, 60 million, 60 million, and 60 million CBBCs for Xiaomi, Alibaba, Great Wall Motor, and Semiconductor Manufacturing International Corp., respectively.
  • Funding cost: HK$0.21020, HK$0.23960, HK$0.12280, and HK$0.22400 for each series.
  • Expiry dates: 26 November 2021, 17 December 2021, 25 March 2022, and 30 December 2021 for each series.
  • Settlement date: The third CCASS settlement day after the end of the MCE valuation period or the later of the expiry date and the day on which the closing price is determined.
  • Effective gearing: 2.09x, 1.76x, 1.49x, and 1.90x for each series.

Sources:

  • Vontobel Limited announcement