China developer Country Garden planning US$1b convertible bond sale: sources

Hong Kong

COUNTRY Garden Holdings Co, China's biggest developer by sales, is planning to raise at least US$1 billion in a convertible bond sale, according to people with knowledge of the matter.

The Foshan-based company aims to sell the securities as soon as this year, said the people, who asked not to be identified because the information is private. Proceeds will be used to help refinance convertible notes that mature in January 2019, they added.

Shares of Country Garden have fallen 35 per cent in Hong Kong trading this year through Thursday. The decline makes it the worst performing member of the Hang Seng Properties Index, which has dropped 10.4 per cent over the period.

Deliberations about the financing are ongoing, and there is no certainty they will lead to a transaction, said the people. A representative for Country Garden said the company "has been looking at different financing plans all along", declining to comment further.

Chinese developers sold a record US$5.3 billion of convertible bonds in January when many of their shares were trading close to all-time highs. Country Garden raised HK$23.5 billion (S$4.1 billion) in a share placement and a convertible bond sale that month. BLOOMBERG