Sold out in 10 minutes! ZIJIN MINING's $1.5 billion convertible bonds received 8 times oversubscription

Against the backdrop of recent surges in gold prices and geopolitical tensions, Chinese mining giant ZIJIN MINING GROUP CO., LTD. successfully seized the window of opportunity in the capital market. The company's $1.5 billion convertible bond issuance project was fully subscribed by investors within just 10 minutes of opening, demonstrating the strong global demand for high-quality mining assets.

According to insiders who spoke to Bloomberg, this issuance received nearly 8 times oversubscription, attracting participation from over 200 investment institutions, with demand far exceeding expectations. The sources of funds for the subscriptions were diverse, covering both international and Chinese long-term funds and hedge funds. This strong market response not only highlights ZIJIN MINING's leading position in the industry but also reflects investors' continued optimism towards the metals and mining sector.

The convertible bonds issued are zero-coupon bonds maturing in 2031, with an initial conversion price set at HKD 63.30 per share, representing a premium of approximately 37% over the previous trading day's closing price of HKD 46.14. The raised funds will primarily be used for construction expenditures at the La Arena gold mine project in Peru, to supplement working capital, and for other general corporate purposes.

Recently, Chinese mining companies have been experiencing a wave of financing enthusiasm. ZIJIN MINING's move is not only a key step in its global expansion strategy but also represents another heavyweight financing in the mining sector following Luoyang Luanchuan Molybdenum and Jiangxi Copper, further consolidating the industry's activity in the capital market.

Strong Subscription Demand and Pricing Strategy

According to Bloomberg citing insiders, the subscription speed for this transaction was extremely fast, achieving full coverage within just 10 minutes of opening. Ultimately, the transaction realized nearly 8 times oversubscription, which is rare among recent large-scale financing projects. Insiders pointed out to Bloomberg that the buyers included long-term funds that typically do not engage in short selling, as well as hedge funds seeking arbitrage opportunities.

In the end, the company locked in the initial conversion price at HKD 63.30, representing a premium of approximately 37% compared to Thursday's closing price.

According to a stock exchange announcement released on Friday, the coupon rate for the issued convertible bonds is zero, and they will mature in 2031. At the same time, bondholders will have the right to request ZIJIN MINING to redeem the bonds on February 5, 2029. For the company, this convertible bond involves a 90-day lock-up period.

Use of Funds and Global Expansion Layout

It is reported that the $1.5 billion raised has a clear strategic direction. The core part will be used to fund the construction capital expenditures of its La Arena gold mine project in Peru. The remaining funds will be used to supplement working capital and meet other general corporate purposes.

Just this week, its subsidiary ZIJIN GOLD agreed to acquire Canada’s Joint Venture Gold Company for CAD 5.5 billion (approximately USD 4 billion). Joint Venture Gold has multiple mineral projects in Africa. Notably, ZIJIN GOLD conducted its initial public offering (IPO) in Hong Kong last year, raising $3.7 billion.

Financing Wave Among Chinese Mining Companies

ZIJIN MINING is not the only Chinese mining company recently active in the capital market. With the continued heat in precious metals markets, several industry giants have launched financing plans. Last week, copper producer Luoyang Luanchuan Molybdenum just raised $1.2 billion through the sale of convertible bonds In addition, Jiangxi Copper also plans to raise up to $3.6 billion through bond issuance.

Data compiled by Bloomberg shows that these transactions by ZIJIN MINING, Luoyang Luanchuan Molybdenum Industry, and Jiangxi Copper account for approximately 40% of the total bond financing amount ($15.6 billion) for Chinese metal and mining companies so far in 2025. Previously, the industry's total bond financing amount for 2024 had already set the highest annual record since 2022