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you're
looking for. 1.
NWS seeks $6 billion loan deal 2.
Lenders take control of Gold-Face villa project 3.
KCRC seeking $30b to fund projects 4.
$1b Lantau road `not linked' to prison site 5.
AGM hooligans 6.
Infectious disease facility would not be Hong Kong's
first 7.
Hot weather triggers dengue fever warnings 8.
S*A*R with Tom Hilditch 9.
Does Hong Kong still need a superjail? 10.
A bit of advice on advisory committees 11.
Wheeler
1. NWS seeks $6 billion loan deal
Sebastian
Tong, The Standard 21 May 2003 Listed
infrastructure and ports operator NWS Holdings has begun talks with banks for
a HK$6 billion syndicated loan even as its parent New World Development wraps
up a HK$3 billion five-year loan deal. New
World Group spokesman Kwan Chuk-fai confirmed yesterday that NWS Holdings had
begun talks with Bank of America, BOC Hong Kong, DBS Bank, Hang Seng Bank, HSBC
and ICBC Asia for a HK$6 billion five-year loan to repay the remainder of the
HK$7 billion bridge loan obtained late last year as part of the group's restructuring
moves. The six banks were the original lenders of the one-year bridge loan for
NWS Holdings, then known as Pacific Ports Holdings. In
April, the borrower made an early HK$1.7 billion repayment for the restructuring
loan. The company currently had net debt of HK$8.5 billion, Kwan said. ``We hope
to close the deal by July.'' Banking
sources say NWS Holdings, which has a BBB- investment grade rating from Standard
& Poor's, should obtain financing with relative ease compared with its listed
parent, New World Development. ``NWS Holdings is seen as a company with better
cash flow compared to its parent,'' one banker said. On
April 29, New World Development obtained a HK$3 billion five-year loan arranged
through wholly owned subsidiary Hong Kong Island Development. However,
the underwriters of the deal - BOCHK, DBS Bank, Hang Seng Bank, HSBC and ICBC
Asia - are said to be facing difficulties selling down the loan at general syndication. A
top all-in yield of 82 basis points over Hibor (Hong Kong Interbank Offered Rate)
was offered to lenders for commitments of at least HK$150 million. Although
Friday's deadline is looming, sources close to the transaction say no bank has
joined the syndicate yet and the deadline may have to be extended. ``A
lot of banks already have substantial exposure to New World. The company has borrowed
quite a lot,'' a banker noted. At
the end of the financial year ended last June, the property developer's debt to
assets ratio stood at 32.2 per cent compared with zero gearing for NWS Holdings. New
World Development spokesman Aldous Chiu declined to comment on the progress of
the general syndication.
2. Lenders take control of Gold-Face villa project Staff
reporter, The Standard 21 May 2003 A
syndicated loan group led by BOC (HK) has taken over a luxury residential project
at Tuen Mun from cash-strapped developer and investor Gold-Face Holdings as settlement
of a HK$200 million loan. The
legal action, which was executed under the mortgage agreement, will put the 319-unit
Villa Pinada development - including HK$500 million in revenue generated from
200 units already sold - under the management of the lenders for further account
auditing. Ernst
& Young, the property receiver commissioned by the lenders, said they would
be responsible for the financial management of the project, including the HK$500
million in sales revenue and revenue from future sales. The
unfinished development has been closed since shortly after the lenders took possession
of the site last Friday. The
assets were owned by Gold-Face subsidiary True Go Investments. According
to the occupation permit granted by the government, the developer should complete
all proceeds of property ownership transferral with the buyers before Friday. But
this process has been suspended as the auditor first has to confirm the details
of the sale and purchase agreements. The receiver would also audit the accounts
of True Go Investments and the project's construction contracts. Ernst
& Young representatives will meet the flat buyers on Friday to discuss details
of the property transferral. Gold-Face
declined to comment yesterday. The company had earlier received a statutory demand
from construction company Chun Wo for the repayment of HK$69.02 million, failing
which Chun Wo would have the right to commence further legal proceedings that
could include the presentation of a winding-up petition against Gold-Face. The
statutory demand was made under a purported deed of guarantee between the company
and Chun Wo on the construction of a development situated at Casa De Oro, Hung
Shiu Kiu, in the New Territories. Gold-Face
has also sold a loss-making London shopping mall to a private company, Rosewheel,
for HK$295.2 million to repay bank loans. Gold-Face
shares were suspended from trading on Monday; they last traded at 54 HK cents.
3. KCRC seeking $30b to fund projects
Foster
Wong, The Standard 21 May 2003 The
Kowloon-Canton Railway Corporation (KCRC) said it would need to borrow HK$30 billion
from now to 2008 to finance building the Sha Tin-Central Link and the Kowloon
Southern Link. The
rail operator said it planned to finance 60 per cent of the sum from bank loans,
and 30 per cent through a bond issue. The
corporation will raise at least HK$1.3 billion of the HK$30 billion it needs after
the successful issuing of a HK$800 million, 10-year institutional bond last Thursday
and a HK$500 million retail bond issue that was launched yesterday. ``We
have yet to decide whether to issue bonds again in the second half. We will be
watching the market closely and will be coming back for more when conditions are
right,'' chairman Michael Tien said. He
added the risk of issuing bonds in Hong Kong was relatively lower than overseas
due to the absence of foreign exchange risks. The
retail bond launched yesterday will be issued in two tranches - one with a tenor
of five years and a coupon rate of 3 per cent, and the other a tenor of 10 years
and a coupon rate of 4.8 per cent. This offers Hong Kong retail investors the
longest-dated local currency bonds ever. The longest maturity seen so far on Hong
Kong dollar debt instruments sold to retail investors was seven years when the
Airport Authority launched its HK$1.2 billion retail bond issue last year. The
government-owned rail operator said it intended to raise the offer amount of its
retail bonds if the response was positive. The offer will be open for public subscription
from today until May 30. Meanwhile, Tien said there had been a pick-up in passenger
volume on the KCRC's local line after its numbers fell more than 20 per cent,
and the number of cross-border passengers dropped more than 30 per cent last month. He
said the decline in passenger numbers on the local line had now narrowed to about
10 per cent less than the same time last year. Separately,
Secretary for Financial Services and the Treasury Frederick Ma said the government
would not consider issuing bonds in the short term to fund its economic boosting
measures in the wake of the Sars outbreak, adding interest costs was the main
reason for the decision.
4. $1b Lantau road `not linked' to prison site
Paris
Lord, The Standard 21 May 2003 Government
officials yesterday denied a planned HK$1 billion road on Lantau Island was for
the proposed HK$12 billion "super prison". A
Lantau resident identified as Cassie told RTHK Radio 3's Backchat programme that
Legislative Council members would this Friday vote on approving money for widening
Tung Chung road, requiring cutting through three kilometres of country park. Planning
department assistant director and programme guest Augustine Ng said the road would
relieve traffic pressure. ``The
widening of Tung Chung road has nothing whatsoever to do with the proposed prison
in Hei Ling Chau,'' he said. Ng
also denied there would be further development on South Lantau for the prison,
such as staffing quarters, saying they would be built on the proposed reclaimed
area between Hei Ling Chau and Sunshine islands. Deputy
Secretary for Security Jennie Chok said she did not think the planned 7,220-bed
prison would be an ``eyesore''. ``I don't think it will necessarily have to be
intrusive,'' Chok told the programme. ``With good design and architecture, I think
that it can even look quite nice, so it is not going to be a sky-scraper.'' Mui
Wo resident Neil McLaughlin said the prison would be visible from Victoria Peak,
Tsing Yi and Lamma Island. Ng
said another site at Kong Nga Po - which would take emergency units 30 minutes
to reach against 90 minutes to Hei Ling Chau - was dropped because local residents
preferred commercial development. Legislative
Council members voted last Friday for a HK$7 million phase one study into land
use and planning issues for the site.
5. AGM hooligans
Lai
See, SCMP 21 May 2003 If
Hong Kong shareholders thought they had it bad at annual general meetings, they
should look to Britain for comfort. Not only do people ask questions, they lobby,
shout, heckle, put on fancy dress and even vote down whopping pay packets. Even
worse - there is no obvious sign that after sitting through all of that you are
guaranteed a lunch box. Sacrilege. This
week's GlaxoSmithKline shareholder meeting in London perhaps took the prize. By
Hong Kong standards, it resembled a state of utter anarchy. Shareholders
rejected a proposed pay package for the company's chief executive, Jean-Pierre
Garnier, and other top executives, according to The Independent newspaper. This
was the first rejection since a new investor protection law was enacted this year
requiring executive pay plans to be put to shareholders for a vote. And
then there were the voices of discontent: "Jean-Pierre isn't a fat cat, he's
something else entirely. He's a cat burglar, robbing us blind," one shareholder
sniped. There
was also taunting - with a packet of peanuts. These were directed at Mr Garnier,
over a quip he once made about getting monkeys. The
board was also reminded that Mr Garnier's severance package "would buy life
for 100,000 people in the developing world". Some
of the impact of this was lost, however, given that some protesters had turned
up in fancy dress - as fat cats, of course. Hong
Kong investors can breathe easy. Lone corporate governance activist David Webb
is all that stands between them and their free lunch.
6. Infectious disease facility would not be Hong Kong's first
ALEX
LO, SCMP 21 May 2003 The
proposed new hospital would not be Hong Kong's first facility dedicated to the
treatment of patients with infectious diseases. A
donation by brewery owner Jehangir Ruttonjee financed the establishment of Hong
Kong's first anti-tuberculosis sanatorium in 1949. Originally
a military hospital, the facility in Queen's Road East, Wan Chai, was converted
into the Ruttonjee Sanatorium with the support of the businessman and the Hong
Kong Tuberculosis,
Chest and Heart Diseases Association. It
played a leadership role in the fight against tuberculosis over four decades,
leading to the disease's eventual elimination as a public health threat in the
late 1980s. After
the drop in the number of TB patients, the government transformed it into a general
hospital, renaming it Ruttonjee Hospital in 1991. In April 1998, it was integrated
with Tang Shiu Kin Hospital to improve efficiency. Ruttonjee now handles patients
who need additional care after being transferred from Tang Shiu Kin Hospital,
which handles emergency cases. In
post-war Hong Kong, Lai Chi Kok Hospital, which has since been turned into a convalescent
home, was the main institution that cared for lepers in the colony. There
were still about 20 new cases of leprosy in Hong Kong every year up to the mid
1990s. However, public clinics were increasingly used to treat leprosy in the
1980s. There were three new cases of leprosy last year.
7. Hot weather triggers dengue fever warnings
MARY
ANN BENITEZ, SCMP 21 May 2003 With
the onset of warmer weather, the government's alert system for dengue fever is
starting to buzz. It shows that Ma Wan Island, where the first local outbreak
of the disease was recorded last July, is still Hong Kong's hot spot. Since
January, the government has been monitoring the distribution of the Aedes albopictus
mosquito, a carrier of dengue fever, in select areas through what it calls an
"ovitrap index". The measure was introduced after the first local outbreak
was detected among workers at the Park Island development on Ma Wan. Twenty people
came down with dengue fever from July to September last year. The
index jumped from 1.4 per cent in March to 11.4 per cent last month. This is consistent
with seasonal patterns but lower than the 30.2 recorded at the same time last
year. But eight
areas recorded readings of more than 20 last month, including the highest of 39.3
at Ma Wan. Wong Tai Sin Central was next at 37.5, followed by Cheung Chau 36.4,
Lowu 26.1, Kwai Chung 22.6, Tung Chung 22.2, Kennedy Town 22 and Tai Po North
at 21.7. Officials
called for greater public awareness. "We are under constant threat [of dengue
fever], so it is important that everybody make an effort to reduce the mosquito
population," environmental hygiene consultant Ho Yuk-yin said. Officials
also spoke about the need to remain vigilant against other diseases such as bird
flu. Microbiology
expert and council chairman Yuen Kwok-yung said: "Control of avian flu in
our locality and in China is important for the world.'' He said Hong Kong's vaccination
of chickens would help prevent the re-assortment of genes between the H5 and human
influenza virus.
8. S*A*R with Tom Hilditch
SCMP,
21 May 2003 New
Words form the Washington Post's Style Invitational. Readers take a word and change
it by a letter to create a new definition: Intaxication:
Euphoria at a tax refund, which lasts until you realize it was your money to start
with. Foreploy:
Any misrepresentation about yourself for the purpose of getting laid. Giraffiti:
Vandalism painted very, very high. Sarchasm:
The gulf between the author of sarcastic with and the person who doesn't get it. Inoculatte:
To take coffee intravenously when running late. Hipatitis:
Terminal coolness. Osteopornosis:
A degenerate disease. Glibido:
All talk and no action. Ignoranus:
A person who's both stupid and an ass.
9. Does Hong Kong still need a superjail?
SCMP,
21 May 2003 As
economic circumstances change, public priorities change, and public works projects
can become lightning rods for controversy. For post-dotcom-boom Seattle, the project
is a central public library built to a futuristic design developed by Dutch architect
Rem Koolhaas. For Hong Kong, it is the proposed "superjail" that the
Security Bureau wants to build on Hei Ling Chau island off Lantau. While
Seattle's new library is already under construction, Hong Kong has the chance
to sit back and decide whether this prison is something that it really wants.
When the prison was first proposed in late 2000, fiscal budget deficits were not
a consideration. A $28 billion complex to house 15,000 inmates was mooted. The
main concern from members of the Legislative Council's security panel then had
more to do with the manageability of such a large prison, rather than issues such
as cost or even environmental impact. Flash
forward nearly three years later. Hong Kong is mired in economic gloom, brought
on by the bursting of its property bubble, slowing global trade and regional competition
- and made worse by Sars, which has brought a World Health Organisation travel
advisory that is keeping business and leisure visitors from the city. Urban dwellers
are flocking to the countryside on weekends and there is talk of using eco-tourism
to revive our travel industry. The
project has been scaled back to a $12 billion complex housing 7,220 inmates, but
the prison becomes more controversial by the day, with strong opposition now coming
from green groups and residents who live near Hei Ling Chau. Considering this
opposition, and considering that Legco has approved funds for a feasibility study,
now would be a good time for the government to pause and take stock of the costs
and benefits of this project. The
new prison is meant to replace eight of 24 now in use. The government had previously
estimated that billions could be gained from selling the sites now occupied by
those eight prisons. We need a new assessment, based upon a current, and realistic,
view of what those lands are worth today and what they will be worth when the
government puts them on the market. After
the project scope was halved because of security concerns, and factoring in the
planned closures, the new prison will add 2,600 new places to the overall system.
The consultants who conduct the feasibility study and the government itself will
need to consider whether this is the best possible use of $12 billion in public
money at the moment. The
original Security Bureau plan suggested cost savings from centralised management
and economies of scale, but a full study on potential cost savings, has yet to
be done. The public and Legco would probably not be convinced of this until they
see more details. Recent
vocal opposition to the project has come from green groups and residents of neighbouring
areas, including Peng Chau, Discovery Bay and villages on the southern side of
Lantau. Granted that some measure of "not in my backyard" opposition
will always dog such proposals, due consideration has to be given to the concerns
raised about rare species in the area and about how the prison may change, for
the worse, the tourist appeal, or even the real estate values, of the adjacent
lands. Existing
prison facilities that are not appropriate for housing inmates were another factor
cited in the early proposals, and are a valid concern. But a feasibility study
should also look into alternatives such as renovation of some of these. In the
end, there is no rush here. Construction is scheduled to start in 2006 and run
for six years. The first part of the feasibility study, which will include an
environmental impact assessment and public consultation, is expected to take about
eight months. We encourage the government and the public to use this time to engage
in an open and honest debate about what would be best for Hong Kong.
10. A bit of advice on advisory committees
SCMP,
21 May 2003 The
Hong Kong government has 470 advisory committees comprising thousands of members
to offer it advice on almost every aspect of life, from allocation of government
quarters to the prevention of legionnaires' disease and the practicalities of
boating and yachting. In the spirit of democracy, anyone can nominate themselves
to serve on any of the committees by simply filling in a form published on the
website of the Home Affairs Bureau. Look
closer, and the picture is not so sanguine. An investigation by this newspaper
in 1999 found that the government had a central database of about 17,000 personalities
who might be considered for appointments. Still, it was apparently short of "suitable"
candidates. It seemed that a small number of people were hot favourites among
bureaucrats in charge of filling up the committees. One was a concurrent member
of 13 committees. A recent study by several pro-democracy political groups has
found that dozens of people, mainly businessmen and professionals, have been appointed
to seven or more advisory bodies, despite a rule against anyone serving on more
than six bodies. At the same time, at least 60 bodies have breached another guideline
barring members from serving on any one body for more than six years. These
are not the only problems. Over the years, the media has time and again exposed
serious problems of absenteeism among individual members, who were re-appointed
despite failing to show up at most meetings. Various studies have also pointed
to an apparent bias in favour of appointing people friendly to the administration.
There are good
reasons for governments to set up advisory committees of one kind or another,
to help gauge the views of different sectors and to involve publicly minded citizens
in the governance of Hong Kong. But do our 11 bureaus really need the service
of 470 such bodies? And what is there to stop them from appointing yes-men to
offer them advice that lends credence to their pet policies? In
launching the accountability system for principal officials last year, the chief
executive pledged to conduct a review of the system of advisory committees. He
would do well by considering the findings of a recent study by the Legislative
Council. This showed that Hong Kong has no specific policy on the appraisal of
members and evaluation of the effectiveness of individual advisory committees,
and no code of practice or guidelines on establishing a committee or appointment
and removal of members.
11. Wheeler
SCMP,
21 May 2003 
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