Mainland property developer SRE Group plans to raise as much as US$155 million from sales of convertible bonds and shares to refinance debts, market sources said.
The company is selling US$60 million worth of yuan-denominated convertible bonds, according to a sales document sent to fund managers. The five-year bonds will pay an interest of 5 to 6 per cent every six months.
The firm can issue a further 140 million yuan more if demand warrants. Investors could sell back their bonds to the company after three years, on or about July 2012.
SRE has also offered US$65 million worth of new shares, another document shows. The 500 million shares will be priced at 95 HK cents to HK$1 each, representing a discount of up to 12 per cent to the stock's last closing price of HK$1.07 before trading was suspended yesterday afternoon. It can sell a further 86.8 million new shares to raise HK$86.8 million to meet demand.
Proceeds from the deals would be used to finance US$200 million in outstanding high-yield bonds due in 2013, according to the document. Credit Suisse and Deutsche Bank are handling both offerings.
An analyst said the convertible bonds had attractive terms, as SRE needed that to lure investors.
