NOTES TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION For the six months ended 30 June 2022 17. CONVERTIBLE BONDS On 9 September 2020, the Company issued US$350,000,000 in principal amount of 1.50% convertible bonds due 2025. There was no movement in the number of these convertible bonds during the period. The convertible bondsmay be converted into ordinary shares of the Company at the option of the convertible bondholders at the prevailing conversion price on or after the date which is 41 days after 30 September 2020 up to and including on the ten day prior to 30 September 2025 (“Maturity Date”) (both days inclusive). On the date of issuance, the initial conversion price was HK$32.13 per share (“Conversion Price”), subject to adjustment upon occurrence of certain prescribed events based on the terms and conditions of the convertible bonds. Subject to satisfaction of certain conditions, the convertible bonds may be redeemed at the option of the Company at any time after 30 September 2023 and prior to the Maturity Date, in whole, but not in part, for the time being outstanding at their principal amount, together with interest accrued but unpaid to but excluding the date fixed for redemption. The Company will, at the option of the convertible bondholder to redeem all or some only of such holder’s convertible bonds on 30 September 2023 at 100% of their principal amount, together with interest accrued but unpaid up to but excluding such date. The convertible bonds are interest-bearing at 1.50% per annum payable semi-annually in arrears in March and September respectively. The fair value of the liability component was estimated at the issuance date using an equivalent market interest rate for a similar bond without a conversion option. The residual amount is assigned as the equity component and is included in shareholders’ equity. As of 30 June 2022, there was no conversion of convertible bonds. The convertible bonds issued have been split into the liability and equity components as follows: Liability component Equity component Total US$’000 US$’000 US$’000 Issue of convertible bonds 301,499 48,501 350,000 Direct transaction costs (4,959) – (4,959) At the issuance date 296,540 48,501 345,041 At 1 January 2021 298,997 48,501 347,498 Effective interest expense 15,011 – 15,011 Net increase in interest payable (5,239) – (5,239) At 31 December 2021 (audited) and 1 January 2022 308,769 48,501 357,270 Effective interest expense 7,639 – 7,639 Net increase in interest payable (2,603) – (2,603) At 30 June 2022 (unaudited) (note 15) 313,805 48,501 362,306 R E A C H I N G N E W H E I G H T S 70
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