BEIJING Dec 19 Industrial and Commercial Bank
of China (ICBC) , the country's biggest
lender, said on Monday it has agreed to conduct a 5 billion yuan
($720 million) debt-for-equity swap with cement producer Jindong
The bank will use a limited partnership fund to make a 2.5
billion yuan investment in Jindong in the first phase of the
swap, ICBC said in a statement.
Jindong, headquartered in Hebei province, is one of China's
biggest construction materials companies. Its controlling
shareholder is state-owned BBMG Corp .
The deal marks the second debt-for-equity swap announced by
ICBC since Beijing launched the scheme in October in a bid to
reduce its $18 trillion in corporate debt, equivalent to 169
percent of domestic output.
Earlier this month, the bank said it had signed a 10 billion
yuan debt-for-equity swap with Shandong Gold Group to reduce the
company's debt burden.
After the proposed $720 million debt swap, Jindong's
leverage ratio will come down by 8 percent, ICBC said in the
"Through financial support, ICBC will help Jindong upgrade
its industrial structure and push the company to invest more in
research to develop in a resource-conserving,
environment-friendly way and aid Beijing in the fight against
smog," the statement said.
Hebei, an industrial region bordering the capital, is one of
China's most polluted provinces.
($1 = 6.9452 Chinese yuan)
(Reporting By Shu Zhang and Matthew Miller; Editing by Sherry