By: Steve Toloken
January 13, 2014
Chinese equipment maker Haitian International Holdings Ltd. said Jan. 10 that it plans a large bond sale to raise nearly $200 million (1.21 billion Chinese yuan) and bring in new investors to broaden its capital base.
The Ningbo, Zhejiang-based company, which is China’s largest plastic machinery maker, did not say what it planned to use the money for, other than for “general corporate purposes.”
But the company has announced sizable expansions in the last year, including a 120,000 square meter facility in Ningbo with a capacity for up to 10,000 all-electric presses.
“The directors consider the issue of the bonds as an opportunity to broaden the capital base of the company,” Haitian said in a Jan. 10 filing to the Hong Kong Stock Exchange.
The company said it retained investment banks J.P. Morgan Securities plc and UBS AG’s Hong Kong branch to manage the sale, which would be to at least six separate investors. The two investment banks have an option to sell an additional $50 million (304.6 million yuan) in company bonds.
The initial $200 million sale would net Haitian $196.2 million (1.19 billion yuan), with total expenses and commissions for the banks of $3.8 million (23.1 million yuan), the company said. The sale is slated to take place in February and the bonds would be convertible by 2019.
The bonds would be turned into shares and give the new investors a total stake of 3.79 percent, and dilute the ownership stake of Sky Treasure Capital Ltd., a holding company controlled by Haitian executives and board members, from 60.08 percent to 57.8 percent of Haitian stock.