Product Overview

Merger & acquisition (M&A) loan refers to a loan granted by Bank of China (BOC) to an acquiring entity or its subsidiaries to pay transaction consideration and costs related to an M&A deal.

Eligible Borrowers

Corporate clients.

BOC Advantages

Outstanding market performance. Over the past decade, BOC has ranked the first on the Asia-Pacific (excluding Japan) list as Mandated Lead Arranger for M&A financing, and has received multiple awards, including “Best Leveraged Finance & M&A Syndication in Asia-Pacific” from Asia Pacific Loan Market Association and “Best Cross-border M&A Financial Services Institution” from Morning Whistle Group.

International network. BOC has the widest global coverage among Chinese banks. Leveraging its globalization strengths and the “One-point Access to Global Response” collaboration mechanism across branches, BOC provides customers with diversified financial services worldwide.

Integrated business platform. BOC possesses the most comprehensive suite of licenses for integrated operations among Chinese banks. Through diverse, flexible and well-established coordinated service models, BOC can meet customers’ end-to-end needs across the entire M&A value chain.

Case

In 2024, acting as mandated lead arranger and facility agent, BOC successfully arranged an offshore M&A syndicated loan of 15 billion yuan ($2.1 billion) for the HK$26.1 billion ($3.35 billion) privatization of A company owned by B company. Ten Chinese-funded large State-owned and joint-stock commercial banks from the Guangdong-Hong Kong-Macao region participated, and the transaction received broad market recognition. This deal is the largest M&A transaction in the consumer goods industry in the Asia-Pacific region in recent years and is also one of the most influential benchmark M&A projects.

Application Process

(1) The customer submits to BOC basic information of the acquiring entity and the target, documents evidencing the acquiring entity’s capacity of financing and investment, information related to the M&A transaction and security materials. 

(2) BOC or an independent third party institution entrusted by BOC conducts due diligence and risk assessment on the target. 

(3) BOC reviews the project in accordance with the procedures. 

(4) Upon internal approval by BOC, both acquiring entity and the target agree on the terms of the loan agreement, mortgage agreement, guarantee agreement and other relevant documents, and the relevant parties execute the agreements, if any. 

(5) The customer fulfills the conditions precedent to disbursement and submits a withdrawal request. 

(6) Upon disbursement, borrower uses the loan.

Fees and Charges: These are determined on a comprehensive basis, taking into account the borrower’s credit profile, guarantee situation, financing ratio, leverage ratio, loan tenor, debt-paying capacity, and market conditions, etc.