Sino Grandness

http://infopub.sgx.com/FileOpen/Sino%20G...eID=392256

So Boon, any comments ?

GUYS! Anyone can explain better? To me is a good news, but just wanting to be sure

I saw the news:

Sino Grandness is pleased to update that the CBs extension agreements with CB1 and CB2 bondholders have been completed, with 40% of the CBs to be converted into debt and 60% of the CBs to be converted into shares in the event of completion of IPO.

The original CB1 and CB2 with total principal sum of RMB350.5m were supposed to account for 23.37% stake before IPO of Garden Fresh, with conversion valuation of RMB1.5b.

With the restructuring, only 60% of the principal sum of the CBs (with 12 months maturity) will have conversion rights with 5% premium given upon conversion based on previously agreed market cap of RMB1.5b.  As such, the estimated stake before IPO for bondholders will be lower at approximately 14.72%, resulting in a smaller dilution by 8.65% for the Company.

The 40% of the CBs will be repaid as debt, of which 15% to be repaid within 3 months and the other 25% to be repaid within 12months.

For further information, please see attached announcement.

With the EGM passed recently to approve the spin-off and the completion of the CB extension for the beverage subsidiary, this will pave the way for company to proceed further with its proposed spin-off exercise for the beverage business.  The company shall provide further update once there is material development relating to the proposed spin-off."

[Edited by moderator, to normalize the font size]

Based on the release of the latest announcement, the proposed listing is gathering momentum.

I am a bit confused in FY 14, CB was valued at RMB 722 mil. based on trade4life post, it seems now the redemption is only the principal sum of RMB 350.5.

So does it mean the holders of the CB has waived the need of paying the accurred interest or taken a haircut. Appreciate clarificatons as it is too confusing for me now. Thanks

(01-03-2016, 09:42 PM)trade4life Wrote: GUYS! Anyone can explain better? To me is a good news, but just wanting to be sure

I saw the news:

Sino Grandness is pleased to update that the CBs extension agreements with CB1 and CB2 bondholders have been completed, with 40% of the CBs to be converted into debt and 60% of the CBs to be converted into shares in the event of completion of IPO.

The original CB1 and CB2 with total principal sum of RMB350.5m were supposed to account for 23.37% stake before IPO of Garden Fresh, with conversion valuation of RMB1.5b.

With the restructuring, only 60% of the principal sum of the CBs (with 12 months maturity) will have conversion rights with 5% premium given upon conversion based on previously agreed market cap of RMB1.5b.  As such, the estimated stake before IPO for bondholders will be lower at approximately 14.72%, resulting in a smaller dilution by 8.65% for the Company.

The 40% of the CBs will be repaid as debt, of which 15% to be repaid within 3 months and the other 25% to be repaid within 12months.

For further information, please see attached announcement.

With the EGM passed recently to approve the spin-off and the completion of the CB extension for the beverage subsidiary, this will pave the way for company to proceed further with its proposed spin-off exercise for the beverage business.  The company shall provide further update once there is material development relating to the proposed spin-off."

[Edited by moderator, to normalize the font size]

i have briefly went through the announcement, just wonder why the bondholders agreed the other 25% to be repaid within 12 months with an interest of 10% only. The current interest rates are 20% and 25%. 

(01-03-2016, 09:18 PM)crubs Wrote: http://infopub.sgx.com/FileOpen/Sino%20G...eID=392256

So Boon, any comments ?

Hi crubs,
 
If I interpret it correctly, the Bondholders have decided to redeem 40% of their investments and leave the option (to convert or redeem) open for the remaining 60% stake. They may or may not convert eventually……….
 
Seems like the Bondholders are not that enthusiastic to participate in the upsides of an IPO. For whatever reasons, I am a bit surprised by that.
 
It is a piece of good news, nevertheless, in the sense that it clarifies the status of the CB.
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Finally pay back CB partially to make it seem like they have some money then delay ipo some more.

Next move will be to get more money from market via rights or warrants, just wait and see...

ROFL..

Sent from my MotoG3 using Tapatalk

If they have decided that only 60% have conversion rights, why not redeem them straight away but allow the 40% to chalk up interest from 10% to 25% for the next 1 year. The only reason i can think of is they dont have the money but why pay more than 500 mil rmb for capex now, shd have paid off the 40%.. Any insights

(02-03-2016, 06:38 AM)BlueKelah Wrote: Finally pay back CB partially to make it seem like they have some money then delay ipo some more.

Next move will be to get more money from market via rights or warrants, just wait and see...

ROFL..

Sent from my MotoG3 using Tapatalk

Hi Bluekalah

Thanks.

Can I know what is the basis of your claim?
Do you know when Sino has to make payment?

cheers
oldman9

(01-03-2016, 11:34 PM)Boon Wrote:

(01-03-2016, 09:18 PM)crubs Wrote: http://infopub.sgx.com/FileOpen/Sino%20G...eID=392256

So Boon, any comments ?

Hi crubs,
 
If I interpret it correctly, the Bondholders have decided to redeem 40% of their investments and leave the option (to convert or redeem) open for the remaining 60% stake. They may or may not convert eventually……….
 
Seems like the Bondholders are not that enthusiastic to participate in the upsides of an IPO. For whatever reasons, I am a bit surprised by that.
 
It is a piece of good news, nevertheless, in the sense that it clarifies the status of the CB.
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Hi Mr Boon


Garden Fresh is the main profit spinner of Sino and Specuvestor has put it nicely that "it benefits SinoG shareholders not to share their crown jewel." 

We now have an arrangement for Bondholders to own 14.7% of Garden Fresh, instead of the original 23.4%. 

The arrangement also eases cash flows because the 40% redemption will happen in 2 phases.

First, RMB 107m to be paid on 31 May 2016, and Second, RMB 179m to be paid 1 year from now. 

It is important to note that the second payment is to be based on 10% interest instead of 25% for 2011 Bonds and 20% for 2012 Bonds. Bondholders must like Garden Fresh very much to agree to the concessions.