GCL Technology Holdings Limited has completed a US$148 million convertible bond issuance to strengthen its working capital and pay down debt. The move provides the solar material producer with greater financial flexibility as it navigates intense competition and high inventory levels in the polysilicon market.
GCL Technology Holdings Limited (HK:3800) completed the issuance of US$148 million in convertible bonds, raising approximately HK$1.14 billion in net proceeds to improve its financial position.
The company announced in a filing that the bonds, listed for trading on the Vienna MTF, are part of an effort to diversify its funding channels in international capital markets.
The 6.95% bonds, due in 2027, have an initial conversion price of HK$1.21 per share. GCL Technology plans to allocate approximately HK$840 million of the proceeds to replenish working capital for manufacturing and other operating expenses, with the remaining HK$297 million designated for the repayment of existing offshore loans and interest.
The capital injection is a strategic move to increase liquidity as the polysilicon industry faces headwinds from rising inventories and a longer cash conversion cycle. While the move strengthens the company’s balance sheet, the potential conversion of bonds into as many as 958 million shares could create dilution for existing shareholders.
This fundraising enhances GCL's ability to maintain operational stability and manage its roughly RMB18.5 billion in total debt. Investors will watch how the capital is deployed to improve efficiency ahead of the company's next earnings report.
This article is for informational purposes only and does not constitute investment advice.
