Kai Yuan Holdings (01215.HK) announced that it agreed to issue to Ga Leung Investment Company Limited convertible bonds in an aggregate principal amount of HK$280 million.

The net proceeds from the issue of the bonds will be HK$280 million, which will be used for general working capital of the group and funding for expansion into the business of trading in commodity products, including but not limited to iron ores. The group also contemplates applying part of the net proceeds for new investments.

Assuming the conversion rights attaching to all bonds are exercised in full at the initial conversion price of HK$0.15 per share, an aggregate of a maximum of 1.867 billion conversion shares shall be allotted and issued, representing 14.61% of Kai Yuan's issued share capital as enlarged by the allotment and issue of the conversion shares.