LVGEM, holder agree to amend some terms of 4% convertibles due 2023

By Sarah Lizee

Olympia, Wash., June 19 – LVGEM (China) Real Estate Investment Co. Ltd. and the holder of its 4% guaranteed convertible bonds due 2023 have agreed to amend some terms of the convertibles, according to a notice.

The amendments would change the put option date to May 17, 2022 from May 17, 2020, the conversion price to HK$3.00 per share from HK$3.594 per share and the interest rate to 5%.

The new conversion price would represent a premium of about 23.97% over the closing price of HK$2.42 per share as quoted on the Stock Exchange of Hong Kong Ltd. on Friday.

Also, the early redemption amount would be changed so that holders would realize a yield of 9.5% instead of 8%.

Other terms of the convertibles would be unchanged, the company said.

LVGEM added that postponing the put option date would allow the group to have more financial flexibility and additional time to develop its business instead of repaying all the amounts outstanding under the convertible bonds in the imminent future.

As of Friday, the bondholder had not notified the issuer that it intends to exercise its right to require the issuer to redeem part or all of the convertible bonds prior to the effective date of the amendments.

No conversion shares had been allotted and issued as of Friday.

The proposed effective date for the amendments is June 29.

LVGEM is a real estate developer based in Hong Kong.

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