Shanghai Pudong Development Bank contributes to a €1.050 billion EUR syndicated loan to facilitate Hillhouse Capital’s acquisition of Philips Domestic Appliances

Project narrative

Circa June 2021, a syndicate of six banks, including Shanghai Pudong Development Bank Co., Ltd. (SPDB), entered into a €1.050 billion EUR syndicated term loan B (TLB) agreement with Nobel Bidco B.V. —a Netherlands-incorporated special purpose vehicle (SPV) and wholly-owned subsidiary of Cayman Islands-incorporated Hong Kong-headquartered Hillhouse Investment Management Ltd. (Hillhouse Capital) — to facilitate Hillhouse Capital’s acquisition of Philips Domestic Appliances. The loan carried a maturity period of seven years. In addition to SPDB, the following lenders contributed to the loan syndicate: JPMorgan Chase Bank, N.A., HSBC, Deutsche Bank AG, Bank of America, ING Group N.V., and the Hong Kong Branch of China Minsheng Banking Corp Ltd (CMBC). JPMorgan, HSBC, and Deutsche served as joint physical bookrunners. Bank of America and ING served as bookrunners. SPDB and the Hong Kong Branch of CMBC served as global mandated lead arrangers. Philips Domestic Appliances (Philips DA) was the domestic/household appliances business of Netherlands-based Koninklijke Philips N.V. Its products included kitchen goods, coffee machines, air purifiers, and vacuum cleaners. The division generated €2.2 billion EUR in sales in 2020. On March 25, 2021, Koninklijke Philips N.V. announced an agreement to sell Philips DA to Hillhouse Capital for a total value of €4.4 billion EUR, with €3.7 billion EUR ($4.37 billion USD) for the business and €700 million EUR for a brand licensing agreement for 15 years for the Philips brand name. The acquisition was funded by the €1.050 billion EUR term loan B and €650 million EUR of additional senior secured debt (bonds) and an equity contribution of €2.3 billion EUR (mix of common and preference shares) from Hillhouse Capital. The acquisition was to close in the third quarter of 2021. Nobel Bidco B.V. was specific acquiring entity. The acquisition closed on September 2, 2021.