On August 27, 2019, Power China Commercial Factoring Co., Ltd. (hereinafter referred to as "POWERCHINA Factoring") successfully issued the POWERCHINA Factoring Phase I Asset-backed Financing Plan on the Shanghai Stock Exchange, with the issuance amounting to CNY 1.078 billion Yuan with a term of 10 months. of .This asset securitization product was issued by POWERCHINA Factoring as the original equity holder and Power Construction Corporation of China (POWERCHINA) as the deficiency payment underwriter by the means of storage shelf issuance.
POWERCHINA Factoring is a commercial factoring company co-founded by POWERCHINA and its subsidiary STECOL Corporation, with a registered capital of CNY 1 billion Yuan. Leveraging the high quality commercial credit resources of POWERCHINA, the company follows the Group's strategy of combing industry and finance, and serves as a specialized financial services platform committed to providing the member companies of POWERCHINA as well as the upstream and downstream enterprises with commercial factoring among other supply chain financial services through assignment of accounts receivable.
POWERCHINA is a global leader in clean low-carbon energy, water resources and environment construction, a core force in global infrastructure connectivity, a leading enterprise serving the "Belt and Road" construction, and an engineering construction investor and developer which provides the domestic and international customers with the whole industry chain integrated services including investment financing, planning and design, construction contracting, equipment manufacturing, management and operation and a package of overall solutions. In addition, it is commissioned by relevant ministries and commissions to undertake state planning and review related to clean energy and new energy such as hydropower, wind power and solar energy.
The basic transactions of this asset-backed financing plan were all completed through the financing system developed by POWERCHINA Factoring, realizing the split and transfer of the creditor's rights. The successful issuance of this financing plan has broadened the financing channels for multi-level suppliers of POWERCHINA.
It is the first time for POWERCHINA Factoring to issue products in the capital market, the first-issue products launched upon getting the No Objection Letter regarding the shelf offering of 3 billion yuan. As the legal advisor of POWERCHINA Factoring, DeHeng formed a team with the Partner Tan Kunlun and Lawyer Qi Xin as the project leaders, and primary support from Zhang Rui, provided legal services for the issuance of the financing plan. The scope of services covers the design of and argumentation of the transaction structure, legal due diligence of the underlying assets, drafting and modification of the transaction documents, and the issuance of final legal opinions. The lawyers cooperated closely with the issuer and intermediaries, took into full consideration the underlying assets to be pooled, and made a well-developed design about the transaction structure and clauses, which was fully recognized by the issuer and the partner institutions. The lawyers will provide ongoing legal services for the subsequent issuance of products of the financing plan.