China's Shanghai Prime Machinery gets OK to issue RMB 1 billion bonds

By Marisa Wong

Madison, Wis., Aug. 14 - Shanghai Prime Machinery Co. Ltd. said it received approval on Aug. 14 from the China Securities Regulatory Commission to issue up to RMB 1 billion of corporate bonds. The approval is valid for 24 months.

Shareholders already approved the proposed issuance at an annual general meeting held on June 15.

The company made a preliminary announcement about the offer on April 25 and a follow-up announcement about the bond terms on May 21.

The bonds will be guaranteed by controlling shareholder Shanghai Electric (Group) Corp. They will have maturities of five years or less. The coupon will be determined according to market conditions. The bonds will not be convertible or exchangeable.

The company said before that it plans to issue the bonds in one or more tranches through an online offer to the public and an offline offer to institutional investors in China. None of the bonds will be placed to shareholders.

Essence Securities Co., Ltd. will act as lead underwriter, trustee and bookrunner and Tebon Securities Co., Ltd. as joint underwriter.

Proceeds will be used to repay bank loans and for general working capital purposes.

Shanghai Prime is a fastener manufacturer and exporter based in Shanghai.

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