Shui On Land upsizes renminbi-denominated CB to $400 million

The convertible comes with the highest conversion premium in more than two years, which is made possible because of the availability of synthetic stock borrow.

Chinese property developer Shui On Land on Friday exercised the entire upsize option on its renminbi-denominated, but US dollar settled, convertible bond issued earlier in the week, increasing the deal size to Rmb2.7 billion $400 million. The CB, which by Friday afternoon was trading at about 102.50, was initially sold at a size of Rmb2.04 billion $300 million.

The bonds attracted good demand from hedge funds and achieved the highest conversion premium on an Asian CB since March 2008 thanks to the provision of a synthetic stock borrow facility. The latter was achieved through a HK$1 billion $128 million equity swap between Standard Chartered the sole bookrunner for the CB and...

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