Aluminium firm Hongqiao to raise US$200m in placement

PUBLISHED : Thursday, 04 September, 2014, 11:05am
UPDATED : Thursday, 04 September, 2014, 11:05am

China Hongqiao Group, a manufacturer of aluminium products, is marketing a top-up placement issue, raising US$200 million to repay existing debt.

The Hong Kong-listed company plans to offer 250.4 million new shares at an indicative range of HK$6.19 to HK$6.36 apiece, representing a discount of up to 9.1 per cent to Wednesday’s closing price of HK$6.81, according to a term sheet seen by the South China Morning Post.

If the offering is well received, the company has the option to issue a further 62.6 million shares, bringing the deal size to US$250 million.

Shares of Hongqiao were halted before the market opened on Thursday.

Besides refinancing, the proceeds will be used for the acquisition of upstream bauxite resources and general corporate purposes.

Bank of America Merrill Lynch is the sponsoring manager for the deal.