An Australian subsidiary of Shanghai Baosteel Group Corporation has raised US$500 million through the issue of bonds listed on the Hong Kong Stock Exchange. The bonds are guaranteed by Baosteel Resources International Company Limited and are due in 2020.

This is one of the first (if not the first) issue of bonds on the Hong Kong Stock Exchange by an Australian subsidiary of a Chinese state-owned enterprise outside the banking sector.

Minter Ellison acted as Australian legal adviser on the fundraising, with a team led by partners Adam Handley (Co-Chair, China Practice and Managing Partner, Western Australia) and David Pratley (Tax). They were assisted by specialist debt capital markets partner John Elias and Lili Pan (Senior Overseas Legal Advisor and China Liaison).

''It is pleasing to once again work closely with our valued client Baosteel in order to help achieve a tremendous outcome for their business," Mr Handley commented. He has advised Baosteel on all of its major legal matters in Australia since 2007.

Because of the nature of the fundraising, numerous new legal and commercial challenges had to be innovatively managed by our team, including the interplay between different market practices and legal requirements in Australia, Hong Kong and China.

According to Mr Pratley, the team was able to deliver a great commercial result "through collaboration with our client, the banks and other advisers to innovatively solve legal and commercial problems for which there was limited or no precedent."

Shanghai Baosteel Group Corporation is a Chinese state-owned iron and steel company and is the second-largest steel producer in the world measured by crude steel output, with an annual output of around 30 million tons.

Paul Hastings acted as Hong Kong legal adviser to Baosteel. Linklaters acted as Hong Kong legal adviser to the joint global co-ordinators, joint bookrunners and joint lead managers.

Deutsche Bank and Standard Chartered Bank acted as the joint global coordinators. Deutsche Bank, Standard Chartered Bank, ANZ, Bank of China, DBS Bank Ltd. and HSBC acted as the joint bookrunners and joint lead managers. CBA and NAB acted as Co-Managers.

In 2014, Minter Ellison advised Baosteel Resources Australia Pty Ltd and Aurizon Operations Limited on their off-market takeover of Aquila Resources Limited – the first major takeover made jointly by a Chinese State-owned entity and an Australian listed company.