Jones Day advised Up Energy Group Ltd and its controlling shareholder Up Energy Holding Ltd in a capital restructuring and senior debt financing, which was a part of their business combination with Tidetime Sun (Group) Limited, a company listed on the Hong Kong Stock Exchange. Up Energy Group and Up Energy Holding are holding companies with mining assets in Xinjiang, China. The assets were acquired by Tidetime Sun (Group) Limited in the business combination for an aggregate consideration of HK$7.8 billion (US$1.0 billion) in the form of convertible bonds. Following the business combination, Tidetime Sun will be renamed Up Energy Development Group Limited, with Up Energy Group being its single largest shareholder.
In February 2010, the Firm advised Up Energy Holding in a US$150 million senior debt financing consisting of the issuance of secured notes and warrants to a syndicate led by the investment arms of China Construction Bank and International Commerce Bank of China. The proceeds were injected into the Xinjiang mining assets in the form of capital contribution through a rights issuance for an offshore subsidiary. Up Energy Holding completed a series of corporate restructurings during 2010, which resulted in the company becoming the controlling shareholder of Up Energy Group, with minority shareholders consisting of approximately 20 institutional funds and natural persons.
In January 2011, the Firm advised Up Energy Holding in a US$70 million senior debt financing consisting of the issuance of secured exchangeable notes to a syndicate led by Merrill Lynch. The notes are exchangeable into convertible bonds of Tidetime Sun. The proceeds were injected into the Xinjiang mining assets in the form of a convertible bonds subscription from Tidetime Sun. Simultaneously with the senior debt financing, Up Energy Group completed a share redemption from its minority shareholders for an aggregate consideration of HK$925 million (US$119 million), which resulted in Up Energy Holding becoming the sole shareholder of Up Energy Group. Convertible bonds in the aggregate principal amounts of HK$3,138 million (US$403 million) and HK$1,356 million (US$174 million) were pledged to the February 2010 and January 2011 syndicates, respectively, as security.
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