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| Sinopec Issues Zero-coupon Convertible Bonds |
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China Petroleum and Chemical Corp. (Sinopec), the country's leading onshore oil producer, has announced to issue zero-coupon convertible bonds worth 11.7 billion It was the largest convertible bond offering by a Chinese company, Sinopec said in a statement released on Tuesday. Net proceeds from the offering will be used to buy pack two Hong Kong-listed companies, Sinopec Beijing Yanhua Petrochemical Co. Ltd. and Sinopec Zhenhai Refining and Chemical Co. Ltd. The offering came after Sinopec took back the investors' rights on another four Shanghai-listed subsidiaries namely Sinopec Qilu Petrochemical Co., Sinopec Yangzi Petrochemical Co., Sinopec Zhongyuan Petroleum Co., and Sinopec Shengli Oilfield Dynamic Group Co. last February at a cash offer of 14.3 billion yuan (US$1.78 billion). Sinopec initiated the privatization drive at IPO in There are only three listed subsidiaries yet to buy back, but Sinopec didn't give details of the possible mode and the time. Chen Tonghai, chairman of Sinopec, said that the bond offering would leave positive impact on Sinopec's profitability and shareholders value. The bonds are priced at a discount from their face value while purchasers are free to convert the bonds into H-shares at a price of 10.76 Bondholders may redeem the bonds on the maturity date at 121.1 percent of the issue price or on April 24, 2011 at 111.5 percent of the issue price, with an annual yield rate of 2.75 percent. Sinopec, the first Chinese company to be listed in It reported net profits up 28 percent to 50.7 billion yuan (US$6.6 billion) last year, while income on its major business rose 31 percent to 1.04 trillion yuan. (Xinhua News Agency April 18, 2007)
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