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It is a part of CII’s plan to issue a non-guaranteed convertible bond volume worth maximum $60 million to Korean investors, aimed to raise investment capital for the company’s major projects.
Under the contract, CII will issue 400 non-guaranteed convertible bonds at the price of $100,000 per unit and an annual yield of 1 per cent for five years.
CII is entitled to redeem bonds from the third year after the sale, but the buyback amount cannot exceed 50 per cent of the total bond volume sold. Accordingly, RAM is allowed to convert at most 50 per cent of the bonds into shares with a conversion price of VND38,500 ($1.71) per share or resell the bond volume at the initial price to CII and enjoy a yield of 4.5 per cent a year.
The conversion price is valued at VND38,500 ($1.71) per share, equalling 130 per cent of CII’s closing price on November 23. The exchange rate used for the conversion is Vietinbank’s average US dollar buying and selling prices on the same day.
Previously, CII completed the sale of $15 million in convertible bonds to Goldman Sachs Investment Partners. The bond issuance was aimed at mobilising capital for the Rach Chiec Bridge project and expanding Hanoi Highway connecting Ho Chi Minh City and neighbouring provinces. The bond will come with a term of five years, and carry a yield of no higher than 4 per cent a year.
RAM is considered a pioneer investor on the international convertible bond market. As of now, it has invested $1.2 billion in over 60 companies in the US, Japan, and Hong Kong, among others.
Meanwhile, CII has a portfolio of strategic infrastructure assets, including water treatment plants. The water company also holds a stake in Thu Duc Water BOO Corp., a water treatment company now 49 per cent owned by Manila Water.
In addition to water infrastructure, CII holds toll road concessions, such as the 15.7-kilometre expansion of the Hanoi Highway, which connects north-eastern Ho Chi Minh City to Bien Hoa, an industrial centre of South Vietnam.
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