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CDC affiliate buys back more than 52% of 3.75% exchangeable convertibles to date
By Susanna Moon
Chicago, April 20 - CDC Corp. said its affiliate has negotiated the purchase of more than 52% of the company's $168 million face value of 3.75% senior exchangeable convertible notes due 2011 at less than par.
This represents a total of $88 million of the exchangeables, which have been purchased from nine of the 11 holders as of April 20.
The company purchased the notes by using internal cash, cash generated from operations and refinancing, with no dilution of shareholder equity resulting from these transactions, according to an earnings release for the fourth quarter and year ended Dec. 31.
CDC said it saved more than $26.5 million in interest and principal as a result of the purchases.
"We believe we are ahead of the curve in ... our cost reduction efforts and have made several significant operational improvements in our business units throughout 2008," Peter Yip, CDC chief executive officer, said in the release.
The company previously said the purchase of the exchangeables at below par value is consistent with a valuation by a third-party consultant that put the value of the exchangeables at 76 in the fourth quarter of 2008.
CDC is a Hong Kong-based provider of enterprise software, online games and internet and media services.
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