Intime Drops in Hong Kong on Plan to Sell $250 Million Convertible Bonds

Intime Department Store (Group) Co., a Chinese retail chain partly owned by Warburg Pincus LLC, fell the most in four months in Hong Kong trading after saying it plans to sell convertible bonds.

Intime declined 3.7 percent to HK$10.02, in Hong Kong trading, the biggest drop since May 25. The benchmark Hang Seng Index rose 0.1 percent.

The retailer hired Bank of America Corp., Morgan Stanley and UBS AG to manage the HK$1.94 billion ($250 million) sale of 1.75 percent convertible notes, it said in a statement to the Hong Kong stock exchange today. The bonds, due 2013, can be handed over for shares when the stock price rises 28 percent from yesterday’s closing price of HK$10.40.

The three-year notes will be priced to yield 4 percent, according to a separate statement sent to investors.

Warburg Pincus last month said it planned to sell as much as a third of its stake in the Chinese department-store operator, according to a term sheet seen by Bloomberg. The U.S. private- equity firm held about 9 percent of the stock as of Aug. 25, according to data compiled by Bloomberg.

Intime has said it plans to build 10 outlets in Beijing over the next five years to tap increasing consumer demand in the world’s most populous nation.

Today’s decline pared Intime’s surge this year to 40 percent, compared with a 0.6 percent advance for the benchmark.

To contact the reporters on this story: Shelley Smith in Hong Kong at ssmith118@bloomberg.net; Andrea Wong in Hong Kong at awong268@bloomberg.net

To contact the editor responsible for this story: Will McSheehy at wmcsheehy@bloomberg.net

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