Director Thomas Lau Luen-hung said a special-purpose subsidiary, Chinese Estates Finance (BVI), had appointed Jardine Fleming to lead-manage a seven-year convertible guaranteed bond issue in the international capital markets.

The bonds will convert into 10-Hong Kong cent shares on or after April 4.

''It is intended the net proceeds of the issue will be used for general working capital requirements of the company and its subsidiaries and to reduce borrowings,'' said Mr Lau.

The company said the bonds on conversion would convert into no more than 20 per cent of the issued share capital of the company at June 10, 1993.

In June 1993, according to the Hong Kong Stock Exchange Securities Journal the group had some 1.65 billion shares of issued capital.

The prospectus to potential investors put total short-term debt of the group at HK$1.156 billion.

The consolidated capitalisation of the group at December 31 showed long-term debt at HK$2.58 billion and shareholders' equity at HK$23.09 billion. Total group capitalisation was HK$26.83 billion.

In addition, the group offered a pro forma unaudited net tangible asset statement after the implementation of a merger with Evergo International Holdings, which became effective last December 6.

At June 30, 1993, assuming the merger on a pro forma basis, the net tangible asset value per share on the basis of approximately 1.66 billion shares in issue at December 31 was HK$14.90.

On January 18, 1992, the group in a restructuring, told investors the consolidated net tangible asset value per share of Chinese Estates was HK$4.83 and of Evergo HK$5.72, on a pro forma and adjusted basis.

Under the disclosure at the time it was shown that the adjusted net tangible asset value attributable to two Chinese Estates shares was HK$9.66.

In a letter to shareholders issued last October, Standard Chartered Asia advised independent shareholders of Chinese Estates on a proposal to merge with Evergo.

The letter said the effect of the merger was neutral to shareholders in net asset value terms.

The adviser said the fully diluted adjusted consolidated net asset value per share of Chinese Estates at June 30, 1993 was HK$7.79 and of Evergo HK$8.23.

The company's statement last night cited 36 property investments held by the group.

Rental income is expected to increase in 1994 because of the completion of renovation at Windsor House, Evergo House and Silvercord.

Entertainment Building is expected to be fully let. The group expects to derive income from rentals from its investment properties and the sale of non-core properties.

Chinese Estates said any repurchases of the bonds by the directors or companies linked to them would be disclosed to the Hong Kong stock exchange.