China Grains and Oils to issue financing bonds
In an attempt to solve its capital shortage problem, China Grains and Oils Group Corporation decided to issue RMB700 million (US$102.5 million) one-year short-term financing bonds.
The company, a subsidiary under China National Cereals, Oils & Foodstuffs Import & Export Corporation (COFCO), is to issue the bonds on January 22, with 50% of the raised capital to supplement working capital and the remaining 50% to swap bank loans to optimise its debt structure.
The subsidiary purchased 2.067 million tonnes of corn and 292,000 tonnes of soy in the first nine months of last year, compared with 2.734 million tonnes and 1.064 million tonnes in 2008.
Gross margin of grains in the company dropped to 5.46% in the nine months from 6.1% in 2008. The company, becoming a major grain trade and logistics platform under COFCO, saw major business revenue of RMB11.74 billion (US$1.7 billion) in the first nine months of 2009, compared with a full-year figure of RMB19.61 billion (US$2.9 billion) in the previous year.