BOCHK contributes to a £80 million GBP syndicated loan to C.banner International Holdings for the acquisition of Hamleys Global Holdings

Project narrative

On October 29, 2015, C.banner International Holdings Limited — a Bermuda-incorporated Hong Kong-headquartered Chinese fashion conglomerate — entered into a share sale and purchase agreement with French toy retailer Ludendo Entreprises SAS and the directors and managements of Hamleys Global Holdings Limited to sell the entire issued share capital of British toy retailer chain Hamleys Global Holdings Limited for a cash consideration of £100,000,000 GBP ($1,190,476,190 HKD) On November 17, 2015, a syndicate of three lenders — the Jiangsu Branch of Bank of China (BOC) as mandated lead arranger, BOC Macau Branch and Bank of China (Hong Kong) Limited (BOCHK) as arrangers, and BOC Macau Branch as agent — entered into a £80,000,000 GBP ($952,380,952 HKD) facility agreement with C.banner International Holdings Limited for the acquisition. This loan carried an interest rate based on 3-month LIBOR plus an unspecified margin and carried a maturity period of 36 months (three years) with an option to extend to approximately 60 months (five years). The loan was repayable in biannual installments, with the first installment repayable 18 months from the drawdown date (a grace period of 1.5 years) and the last repayment at the date of maturity. Record ID #99710 captures BOC Jiangsu Branch's contribution, Record ID #110391 captures BOC Macau Branch's contribution, and Record ID #99711 captures BOCHK's contribution. This loan was secured by (i.e. collateralized against) charges over the shares in each of the members of C.banner International Holdings and its subsidiaries, including Hamleys but excepting Jiangsu Mega Footwear Co., Ltd., granted by their respective shareholder(s), a charge granted by C.banner International over a debt service reserve account and a mandatory prepayment account held by C.banner International in connection with the £80 million GBP facility, and a security granted by C.banner International over a £31,421,016 GBP shareholder loan issued by C.banner on November 25, 2015 to Hamleys Global Holdings Limited. Per a November 17, 2015 intercreditor agreement between BOC Macau Branch as senior agent and offshore security agent and C.banner, the £80 million GBP facility ranked pari passu among itself and above any intra group liabilities between C.banner subsidiaries. On December 16, 2015, The Hamleys Group Limited — an England and Wales-incorporated wholly-owned subsidiary of Hamleys Global Holdings — entered into a share pledge agreement with BOC Macau Branch in which Hamleys Group pledged all of the shares and related rights pertaining thereto over Hamleys Finland Oy, a Finland incorporated subsidiary of Hamleys. On December 17, 2015, also entered into a charge over shares deed over Hamleys Group Limited's one ordinary share over its Ireland-incorporated incorporated Hamleys Toys (Ireland) Limited. On December 17, 2015, also entered into a share mortgage agreement over its one ordinary share in Hong Kong-incorporated subsidiary Hamleys Asia Limited. Additionally, on December 17, 2015, C.Banner International Holdings, Hamleys Global Holdings Limited, and The Hamleys Group Limited also entered into a security over shares deed agreement in which C.banner pledged its own shares in Hamleys Global Holdings Limited, Hamleys Global Holdings pledged its own shares in The Hamleys Group Limited, The Hamleys Group pledged its owned shares in Hamleys of London Limited, The Hamleys Group pledged its owned shares in Scrumpalicious Limited, Luvley Limited, and Hamleys (Franchising) Limited. Additionally, on November 17, 2015, BOC Macau Branch entered into a £10,000,000 GBP ($119,047,619 HKD) working capital facility agreement with C.banner International Holdings Limited. This unsecured loan carried an interest rate of 3-month LIBOR plus an unspecified margin and carried a maturity period of one year, being repayable in full upon 12 months after the drawdown date (a grace period of one year). The proceeds of this facility were to be used by the borrower to strengthen the liquidity and support Hamleys Global Holdings's business operations post-acquisition. Record ID #99712 captures the working capital facility agreement. In addition to the £80 million GBP facility, C.banner used £20,000,000 GBP ($238,095,238 HKD) of its own internal resources to finance the purchase. On November 25, 2015, C.banner International received written approval for the acquisition from over 50% of its shareholders; the same day, the acquisition was completed, making Hamleys a wholly-owned subsidiary of C.banner