Linklaters Advised On China Hongqiao Group’s US$300 Million Convertible Bond Issuance And Concurrent Share Repurchase

Linklaters Advised On China Hongqiao Group’s US$300 Million Convertible Bond Issuance And Concurrent Share Repurchase

Linklaters advised the joint lead managers on China Hongqiao Group’s US$300 million convertible bonds due 2030 and a concurrent share repurchase by the company. This marks the first-ever convertible bond transaction with a concurrent share repurchase for a company with a primary listing on the Hong Kong Stock Exchange (HKEX).

The concurrent share repurchase was part of a sale coordinated by the joint lead managers, allowing buyers of the bonds to sell underlying shares in covered short sales (the “concurrent equity offering”). This mechanism facilitates initial hedging for investors, improves pricing terms for the bonds, and mitigates negative share price impact, ultimately enhancing the attractiveness of the convertible bond product for both issuers and investors.

To execute this transaction, waivers were obtained from HKEX and the Securities and Futures Commission of Hong Kong to comply with specific HKEX listing rules and the Codes on Takeovers and Mergers and Share Buy-backs.

The Linklaters team was led by Taiki Ki (Partner, Capital Markets), Roger Cheng (Partner, Corporate), and Donnelly Chan (Partner, Corporate), with support from Cheng Rui Chua (Managing Associate).

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