Hong Kong Exchanges offers US$400 million convertibles to help fund London Metal Exchange purchase

By Rebecca Melvin

New York, Sept. 24 - Hong Kong Exchanges and Clearing Ltd. plans to issue US$400 million of convertible bonds at a fixed coupon as part of the financing of its previously announced acquisition of LME Holdings Ltd., or the London Metal Exchange.

The offering is subject to shareholder approval and other conditions.

The offer price for LME was initially to be financed from existing cash and new bank facilities, short- and long-term loan facilities totaling at least £1.1 billion, secured from a group of banks including China Development Bank Corp., Deutsche Bank AG, the Hongkong and Shanghai Banking Corp. Ltd. and UBS AG.

Current market conditions and investor feedback has prompted Hong Kong Exchanges to tap the financial market for funding the acquisition for cash, according to a company release.

Hong Kong Exchanges is a securities market operator.

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