Tencent Is Said to Eye Jumbo Dollar Loan at Its Lowest Cost

(Bloomberg) -- Tencent Holdings Ltd. is seeking to raise a facility of about $5 billion from banks, marking its return to the loan market after more than two years.

The Chinese social media giant is in talks with banks for a five-year club loan with a price talk for the margin in the area of 80 basis points over Libor, according to people familiar with the matter. Terms of the loan are not final yet but the proceeds will be used for refinancing and general corporate purposes, said the people, who aren’t authorized to speak publicly and asked not to be identified.

Jane Yip, a spokeswoman with Tencent, declined to comment.

Tencent last came to the loan market in 2017, according to Bloomberg data, when it raised $4.65 billion via a five-year syndicated facility at a margin of 95 basis points over Libor. That’s its cheapest and largest loan yet, the data show. Demand for Tencent’s new loan could provide cues on banks’ lending appetite for high-grade companies. Alibaba Group Holding Ltd. earlier this year managed to cut its loan cost amid slumping loan volumes in the region.

--With assistance from Zheping Huang.

To contact the reporters on this story: Annie Lee in Hong Kong at olee42@bloomberg.net;Mariko Ishikawa in Sydney at mishikawa9@bloomberg.net

To contact the editors responsible for this story: Neha D'silva at ndsilva1@bloomberg.net, Beth Thomas

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