TPG Capital Backs China’s Li Ning

TPG Capital and Singapore sovereign wealth fund GIC will invest about 750 million yuan ($115 million) in convertible bonds in Hong Kong-listed China sportswear brand Li Ning Co. Ltd, Reuters wrote Friday. Li Ning also said in a separate statement that TPG and its affiliates will buy about 5 percent of the existing issued share capital for about HK$349.8 million ($45 million), Reuters wrote.

(Reuters) – Global private equity fund TPG Capital and Singapore sovereign wealth fund GIC will invest about 750 million yuan ($115 million) in convertible bonds in Hong Kong-listed China sportwear brand Li Ning Co Ltd, the company said on Friday.

TPG has agreed to subscribe to 561 million yuan of convertible bonds from Li Ning, while GIC’s affiliate has agreed to subscribe to 189 million yuan of convertible bonds from the company, Li Ning said in a statement.

Li Ning also said in a separate statement that TPG and its affiliates will buy about 5 percent of the existing issued share capital for about HK$349.8 million ($45 million).

The TPG and GIC investment in Li Ning comes as a downturn in the IPO and follow-on markets has led to an increase in convertible bonds for companies seeking to raise cash.

Some $4.5 billion worth of convertible bonds (CBs) are hitting Asia-Pacific markets in the next few weeks. Should the pace continue, CB sales this year would easily surpass the $20.8 billion in 2011.

The five-year bonds issued by Li Ning, which pay annual interest of 4 percent, are convertible at an initial price of HK$7.74 a share, the firm said in an exchange filing late on Thursday.

Li Ning’s shares were suspended on Wednesday, pending the announcement. Trade will resume at 0100 GMT on Friday, the announcement said.

On Tuesday, the company’s shares closed down over 2 percent at HK$6.72.

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