A state-owned Chinese industrial firm is considering to offer a 50-year domestic bond, according to people familiar with the matter, in what would be the nation’s longest-tenor corporate note if completed. 

Wuxi Industry Development Group Co, a company founded by the Wuxi city government in China’s Jiangsu province, has engaged underwriters to sound out investor interest for a potential sale, the people said, requesting anonymity in discussing private matters. The deal - which contemplates raising up to one billion yuan (US$138 million or RM648.82 million) - is still at an early stage of gauging interest, and terms, including the tenor, are subject to change.

If a bond with a tenor of 50 years was offered and if it did wind up getting priced, that would make it the longest-tenor corporate bond ever issued in China’s local market, excluding perpetual securities, data compiled by Bloomberg showed. 

The company, whose operations span across semiconductors, trade, and investment, declined to comment when reached by phone on Thursday. It had a profit of 1.9 billion yuan last year, according to its website.

Investors assume state-owned companies often have their governments’ tacit backing. Such an ultra-long tenor is rare in corporate bond markets in China and elsewhere. But as borrowing costs tumble to record lows, China is experiencing an unprecedented bond issuance boom, and companies are seeking to lock down low financing costs.

  - Bloomberg