20240601
Lenovo Group announced plans to issue $2 billion in zero-coupon convertible bonds to ALAT, a subsidiary of the Public Investment Fund (PIF). The two companies have signed a cooperation agreement to establish a manufacturing facility in Saudi Arabia.
According to Lenovo’s disclosure, the initial conversion price of the bonds is set at HKD 10.42 per share. Based on a Reuters report, these bonds will convert into approximately 1.5 billion shares after three years. Lenovo stated that the proceeds from the issuance will be used to pay off existing debt and for other general corporate purposes.
Under the agreement with ALAT, Lenovo will also establish a regional headquarters and a manufacturing facility in the Middle East to enhance its geographic diversity. This move comes as China and the Middle East have been deepening economic cooperation in recent years.
Saudi Arabia has been forming partnerships with foreign companies, including those from China, to develop its manufacturing capabilities within the Kingdom.
ALAT was established this year to make Saudi Arabia a global hub for electronics and advanced industries.