Bank of China contributes to a $550 million USD syndicated loan to Bright Food to finance the acquisition of a 60% interest in Weetabix Limited (Linked to Record ID#92420 and #89362)

Project narrative

In May 2012, Bright Food (Group) Co., Ltd. — a Chinese state-owned food and beverage company — announced that it would acquire a 60% interest in the British cereal manufacturer Weetabix Limited through its subsidiary Bright Food International Limited from Lion Capital LLP (a private equity firm). Then, in October 2012, Bank of China (BOC), China Development Bank (CDB), National Australia Bank, Rabobank, HSBC, and Royal Bank of Scotland signed a $550 million USD syndicated loan agreement with Bright Food International Limited to finance the acquisition of 60% stake in Weetabix. The loan carried the following borrowing terms: a maturity of 3 years and an interest rate of 6-month LIBOR plus 230 basis points. Bright Food (Group) Co., Ltd. also provided a corporate guarantee for this loan. Additionally, HSBC, RBS, and Rabobank provided another, $300 million USD syndicated bridge loan to support a bond issue. This loan carried the following terms: a maturity of one year and an interest rate of 6-month LIBOR plus 150 basis points. Bright Food (Group) Co., Ltd. also provided a guarantee for this loan. Bright Food (Group) Co., Ltd. acquired the stake in Weetabix — through its subsidiary Bright Food International Limited — in November 2012. In total, Bright Food (Group) Co., Ltd. paid almost £700 million GDP ($1.12 billion USD) and agreed to cover £500 million GBP of Weetabix's debt in its acquisition. Bright Food's equity investment is captured via Record ID#89362. At the time of its May 2012 announcement, the deal was reported as the largest one done by a Chinese company in the food and beverage industry. In 2015, Bright Food (Group) Co., Ltd. bought the remaining 40% share in Weetabix from Lion Capital, only to sell it to Baring Private Equity Asia, its new partner in Weetabix at a deal valued at £1.3 billion GBP. Then, in January 2017, Bright Food (Group) Co., Ltd. put its stake in Weetabix up for sale. Analysts attributed the decision to Weetabix's struggles to sell cold cereal to Chinese consumers, who tend to prefer warm, rice-based breakfasts. On April 18, 2017, Bright Food and Baring Private Equity Asia agreed to sell the entirety of their interests in Weetabix to American company Post Holdings, Inc. for £1.4 billion GBP, ostensibly to improve foreign asserts portfolio and globalization strategy; the transaction was planned to close in the third quarter of 2017. Weetabix Limited was established in 1932 and has been engaged in the manufacture, sale and distribution of cereal and cereal products. Weetabix and its products are particularly famous brand in the British market, but include operations in the United States, Canada, South Africa, and Canada.