Tencent takes CSC yields into single digits

China South City, a developer of integrated logistics and trade centres, found its fortunes transformed this week. The issuer had been facing yields well above 10% for a prospective five year non-call three bond but ended up pricing the note at least 150bp tighter. The catalyst was an announcement that Tencent would buy almost 10% of CSC, which doubled that company’s share price, sent its bond spreads tumbling and changed investors’ opinion of the credit, said bankers on the deal.