China Water Affairs Group, which supplies drinking water for about 18 mainland cities, was raising about HK$650 million by selling convertible bonds to fund projects, sources said yesterday.
The group's second bond issue in about a year could be converted into new shares at HK$7 a piece in five years, the sources said.
The conversion price represents a 28.44 per cent premium to the last closing price of HK$5.45 on Monday. Trading in the stock was suspended yesterday pending an announcement on the convertible bond issue.
Sources said the funds raised would be spent largely on buying water projects. Part of the proceeds would also be used to meet the funding needs of water projects scattered in provinces such as Henan, Jiangxi and Guangdong, they said.
In June last year, the group had sold five-year convertible bonds to DBS for HK$300 million at a conversion price of HK$2 a unit.
China Water, whose shares have gained 153.48 per cent in the past 12 months, has raised a total of HK$1.16 billion from selling new shares and convertible bonds since the beginning of last year.
