First Pacific yesterday said it had bought back US$20 million of its US$350 million convertible bonds, helping to trigger a 9.4 per cent surge in its share price. Analysts said the rebound in the stock was helped by easing concerns in Indonesia, where the company owns a pharmaceuticals business. The recovery came after the stock had slumped almost 20 per cent in the previous week as rioting spread to the Indonesian capital Jakarta. First Pacific said it repurchased the convertible bonds from various institutions at between 83.8 per cent and 88 per cent of their face value. The bonds were issued in March last year and were convertible into shares up until March 2002 at a strike price of HK$12.25 a share. Should the shares fall short of the strike price, the bonds would be redeemed at a price of 134 per cent of their face value, implying an annual yield of 9.6 per cent. First Pacific managing director Manuel Pangilinan said the repurchases were a 'prudent use of a relatively small use of the available cash the company now has on its books'. He said the fact the shares were purchased at a discount should have a small positive effect on the company's earnings per share. First Pacific shares closed 25 HK cents higher yesterday at HK$2.90. However, they remain 70 per cent down on the past year. Analysts said the rebound was at least partly helped by the improving situation in Indonesia, where President Suharto's announcement he would step down this year was seen reducing the level of rioting. The unrest came uncomfortably close to home for First Pacific, as the Jakarta residence of its chairman, Soedono Salim, was destroyed by rioters last week. Mr Salim, an Indonesian-Chinese, is known to be a close friend of Mr Suharto. Analysts said First Pacific's shares were unlikely to climb much higher until more was known about what assets the company would buy to replace the earnings of its trading and distribution unit Hagemeyer. Nikko Research Center chief analyst Steven Thompson said: 'I still have concerns about this company.' Hagemeyer and other assets were sold earlier this year as the company went about cutting back its debt levels.