By Ben Otto
China Evergrande Group will raise gross proceeds of 4.30 billion Hong Kong dollars (US$554.8 million) in a private placement to refinance existing debt.
China's most indebted property developer said in a stock-exchange filing Wednesday that it will issue and sell 260,650,000 new shares at HK$16.50 each. That is an about 14.7% discount to the stock's last-traded price.
The amount raised is much lower than the HK$8.43 billion the conglomerate had initially planned to raise. A term sheet viewed by The Wall Street Journal showed that the company had been seeking to sell 490 million shares for HK$16.50-HK$17.20 each.
China Evergrande said it intends to use proceeds from the placement to refinance existing debt and fund working capital.
The company is Asia's largest junk-bond issuer and last year was China's largest developer by contracted sales. As of June, its outstanding debt totaled 835.5 billion yuan (US$123.84 billion), with almost half scheduled to mature within a year, according to the company's interim report.
Credit Suisse, BofA Securities and UBS are among the advisers for the placement.
Write to Ben Otto at firstname.lastname@example.org
(END) Dow Jones Newswires