China-Based Firms Sell Convertible Debt at Record Pace: Chart

Convertible bond offerings by China-incorporated companies are taking off, after the country relaxed curbs on international debt issuance and firms turned to hybrid securities as an alternative to selling shares in a falling market. Led by China Railway Construction Corp. and CRRC Corp., businesses from Asia’s largest economy sold $2 billion of local and overseas convertible debt this year. Damien Brosnan, who arranged the China Railway Construction and CRRC deals as the Asia head of equity syndicate at UBS Group AG, said the main buyers were convertible arbitrage hedge funds, which capitalize on discrepancies between bond prices and stock volatility.

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