Britain\'s Tesco plans \'dim sum\' bond issue

Britain's biggest retailer Tesco is planning its first offshore yuan-denominated bond issue in Hong Kong, a report said Thursday, seeking to raise over US$100 million. The world's third largest supermarket group by sales is the latest to join a slew of foreign firms that are aiming to tap the so-called "dim sum bond market" as China tries to turn the yuan into an international currency. Tesco will use the net proceeds from the 725 million yuan (US$113 million) three-year offering for general corporate purposes, according to Dow Jones Newswires, citing a draft prospectus of the Hong Kong issue. The report said the hypermarket chain's yuan bond issue was part of a £15 billion (US$25 billion) eurobond programme. It has hired HSBC and Standard Chartered as joint bookrunners for the issue in the Asian financial hub. Tesco oficials in Shanghai could not immediately be reached for comment. The bid signals the rising interest in yuan funding among foreign firms, after US fast-food giant McDonald's raised US$30 million from its bond issue in Hong Kong last year. It is reportedly planning a second offering. Heavy equipment maker Caterpillar followed suit while budget carrier Hong Kong Airlines reportedly said in May that it was also planning a similar issue. Yuan-related financial products have been booming in Hong Kong, a semi-autonomous Chinese territory that has been acting as a test bed for Beijing's ambitious goal to make the unit a global currency. Tesco is the world's third-largest retailer after US-based Wal-Mart and France's Carrefour, both of which have important operations in a booming China where a growing middle class provides a market for Western style shopping. The British group operates about 100 hypermarkets and malls in China, and said earlier this year that it will set up a joint venture with Asian investors to develop shopping malls in China.