HANGZHOU - China's Geely Automobile has raised 1 billion yuan ($153.8 million) through a corporate bond sale aimed at financing the carmaker's development of core technologies on auto parts and auto electronic systems, company officials said Thursday.
The fund-raising was a "timely rain" that will enable Geely to accelerate its core technology development, said Yin Daqing, a vice CEO of the group based in eastern Zhejiang province.
The purchase of the 7-year puttable notes, with an annualized interest rate of 6.4 percent, or 1.42 percent higher than the benchmark Shanghai Interbank Offered Rate (Shibor), was completed in five days after the issuance on June 21.
Analysts with Chinalion Securities Co, the underwriter, said the success of the bond sale shows investors'confidence in Geely's long-term growth.
"It's a better-than-expected sale as the offer of the low-interest bond comes amid the market's expectation of another interest hike by the central bank," an analyst said.
Geely, which acquired the Swedish brand Volvo from US auto giant Ford for $1.5 billion last August, reported in June that its auto sales grew 10.5 percent year-on-year to 183,707 units in the first five months this year, representing 38.3 percent of its sale target for the entire year of 2011.
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