Hong Kong-based Asian alternative investment firm PAG has signed an agreement to invest US$80 million in Beijing Properties (Holdings) Ltd., the Hong Kong-listed property subsidiary of Beijing Enterprises Group, according to a company filing.
Formerly known as Pacific Alliance Group, PAG is to acquire US$80 million worth of convertible bonds issued by Beijing Properties (Holdings). The bonds carry an annual interest of 4% until it matures on February 12, 2019. It can be converted at any time 7 days prior to its maturity date.
The conversion price is HK$0.74 per share, a 21.31% premium to the average closing price of the last five trading days before the date of the announcement.
If fully converted, PAG will hold 11.84% of Beijing Properties (Holdings) on a fully diluted basis.
Beijing Properties (Holdings) says it will use the proceeds on future investments and as general working capital.
This deal is the second large investment into a Hong Kong-listed company by PAG in just a few months. Last November, PAG invested US$200 million in Hong Kong-listed Chinese solar panel producer GCL-Poly Energy Holdings.
Led by chairman and CEO Shan Weijian, PAG manages around US$10 billion and invests in all key markets in Asia Pacific.
Shan spent 12 years as senior partner at TPG and co-managing partner at Newbridge Capital. Before that, he was a managing director and chief China representative of J.P. Morgan.