Often Partisan

BIH Issue Convertible Bond

Birmingham International Holdings have confirmed in an announcement to the stock exchange that they are issuing a conversion bond to raise another HK$120Mil (about £9.17mil) for the company.

The announcement, which was signed off by Carson’s brother-in-law, BIH Vice-Chairman Victor Ma Shui-Cheong confirms that an agreement has been made to issue a conversion bond of HK$120million to a company owned 50% by Victor Ma and 50% by chairman Cheung Shing. This will see another 1.2billion shares potentially issued against the debt –  diluting shareholdings of minor shareholders even further – which also carries an interest rate of 7.5% per annum. This might be some of the reason so many shares (400 odd million) were sold in the company yesterday, driving the share price down 10% to HK$0.11

BIH confirm that funds will be used for working capital within the group and also to fund the “Possible Acquisition” of Ultramax Enterprises Ltd – otherwise known to us as the deal to buy 65% of PetroPro PT. This is interesting in itself, as it’s known that BIH have been told they have to show some diversification of their business prior to selling any of BCFC and this might be the way that BIH have come up with to go ahead with that. It’s also intriguing as the money has come from within the company with Cheung Shing and Victor Ma ponying up the dough to lend to BIH in this manner – for once BIH have not had to go to an outside source to fund the company further. Of course, this will all have to be ratified by an EGM and by the HKSE – and until an EGM is announced this remains a hypothetical deal.

One other intriguing part of this is that BIH have to show what they’ve done with the money that they have already raised in the twelve months prior to the announcement – specifically the placing of new shares and convertible bonds which was agreed in the EGM back in February. The announcement confirms that of the HK$62million raised in the placing agreement (approx £4.74million), HK$28.2million was used to pay debts, HK$18million used for working capital with the rest going to “improve the liquidity position”; and that of the HK$125million raised from the second convertible bond HK$6.8million was used to repay debts (making HK$35million paid off in total); HK$80million was used for working capital and the remaining HK$38.2million went towards looking at funding new acquisitions. It’s a bit vague but this is the first sign that we have that BIH have sorted some of their longstanding debt and liquidity issues out and further reinforces my belief that the sale of the club will not be done on the cheap.

It might seem a bit complex but this is a very positive step towards the sale of the club in my eyes because it could very well help make it a bit more possible. I sincerely hope that’s the case.

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78 Responses to “BIH Issue Convertible Bond”

  • Chris W says:

    Interesting article and ahead of the rest with news from Hong Kong.
    If BIHL are using the money to diversify then it has to be good news that they are moving in the right direction.
    The only information on PetroPro PT I can find is published on Bloomberg Business, they have no records of directors and the phone number is different to the one on the company’s address.

    Could this be another shell of a company like the one supposedly last year?
    KRO+DNM

    • StevieW says:

      Chris

      Sales, maintenance and service for measuring equipment, technical support and solutions for oil and gas industries. that has a solid base of expertise covering all aspects of the exploration and development of Indonesia’s oil, gas, coal, mineral, and geothermal industries.Website

      http://www.ppitech.net/index.php/solutions/quality-mgmt/software

      Industry

      Oil & Energy

      Type

      Public Company

      Company Size

      51-200 employees

      • Blueboy88 says:

        This would seem to be a proper company, not a shell.
        Which raises the question even with the sale of BCFC , how BIH can afford to buy into this company & then develop it for growth?

        • Julian Glass says:

          They use next season’s Premier money

          • Chris W says:

            I don’t think we qualify for anymore parachute payments and if rumours are true this years had already been spent last year.
            KRO+DNM

      • Chris W says:

        The link comes up “error 404”, the data you give is exactly the same as Bloomberg has on the company.
        There are no names of directors or any meeting minutes available, or any listings on stock exchanges recorded. Not saying there isn’t any, just not in the public domain.
        I can find two addresses both in Jakarta for companies under that name, one for just PetroPro the other PetroPro PT.

        One of the problems we have faced with BIHL is the lack of transparency, admittedly they have made this announcement to the HKSE, but didn’t they do that with the last company that turned out to be non-existent.
        KRO+DNM

  • Mark Galloway says:

    A move in Blues’ right direction? Unknown and more smoke and mirrors in my view!

    KRO

  • Art says:

    Chinese water torture-drip drip!

  • Agent McLeish says:

    Seems like we’ve been here before…

  • mark says:

    Great to see blh getting their house in order…

  • Steve says:

    Let’s hope your right Dan.We’re never going to move forward until BIHL are out of the way. I won’t be holding my breath though.

  • mark says:

    Never have all your eggs in one basket …….

    • Staffs Blue says:

      Is your mind scrambled? There’s only one egg (BCFC) and one basket (BIHL) ;-)

      • mark says:

        sweet i like mine hard boiled ;)

      • mark says:

        staffs they will diversify, not because they want to sell, because it makes sense to widen their portfolio…..

      • Geoff S says:

        Would you say this convertible bonds announcement means the end of any involvement Jeremy Wray and his friends might have had?

        • Staffs Blue says:

          I don’t think anyone thought the sale was going to be quick or straightforward.. but after Wray came out and talked about it, I find it very strange that not a single word has emerged from either party since. Whether the deal is still on or off, you’d think someone would have the decency to say so.

      • Art says:

        He’s just getting over excited-it won’t be long before he meets Father Xmas again.

  • Oldbluenose says:

    I have made a comment on todays blog, but it was taken off by Discus, — no reason given, ?. [ though it was non inflammatory.].

    • Staffs Blue says:

      It’s happened about 5 or 6 times to me in the last week or two. But I suppose when you’re a troublemaker like me who constantly posts defamatory remarks… you have to accept that the odd one or ten comments will upset someone. ;-)

      • Oldbluenose says:

        Hiya Staffs;, I would not mind if I had been careless on Dan’s blog, but bearing in mind his [ rightful ] concern about being laid open to P,P.or BIH, considering slander, — I did not make inflammatory comments at all, !!.

        • Staffs Blue says:

          Same here mate. Doesn’t seem to matter. Who knows how these things are viewed and who by.

        • Staffs Blue says:

          Last week, I posted the same comment 3 times and 3 times it disappeared without reason.

        • Staffs Blue says:

          I think I’ve sussed it. It seems to be the longer comments. I’ve just posted two comments on the latest blog. The short one, which was one line, went through fine. The one with 4 lines came up “Hold on, this is waiting to be approved by http://www.oftenpartisan.co.uk.”

          I’m waiting now to see if it disappears!

          • Staffs Blue says:

            Yep. Just refreshed the page and it’s gone.

          • Oldbluenose says:

            Staffs/ Chris W;, Whatever the reason behind it,?. At least Daniel would refer to whatever the ” problem ” was, so we would then be aware of what the ” offence ” actually was, ?.

          • Chris W says:

            Must be your accent Staffs ;-), I think Discus pick up on key words.
            I once sent an e-mail to a US friend and it was picked up by the CIA who wanted a certain sentence verified because of a keyword.
            I have posted long messages without too much trouble, I did when Discus first took over.
            KRO+DNM

          • Staffs Blue says:

            It is very strange… because I shortened by half, the comment that disappeared and re-posted it… and still it had the same message and disappeared again. It would be nice if Mr Ivery could ask Disqus why this happens, just so we’d all know. When he has time of course. ;)

    • Geoff S says:

      The OP blog was “unobtainable” for me earlier. Some sort of glitch or other and clearly nobody’s fault. The internet can be marvellous but the downside is that there is so much that can go wrong.

      • Oldbluenose says:

        Geof S, and Staffs;, It was NOT a glitch at all mates, when I wrote my comment, it said it was being reviewed — Then it was [ disappeared ] ,
        Daniel said to my e-mail direct to him, He does not get much time to view all comments, ?. — ERGO, — Discus, make the decisions, ?.

        • Staffs Blue says:

          That’s exactly what it said every time it’s happened to me. Like I said, I posted the same comment 3 times the other day and all 3 times it disappeared. Sometimes, I just can’t be arsed to type it all out again. (bloody good job some might say) ;)

          • Oldbluenose says:

            hi Staffs;, it would seem that any comments we make [ may ] be taken as libellous to Daniel, [ even if that is not what the comment implies ], !!.
            So best either just live with it, or desist from comments, ?.

        • Geoff S says:

          Apologies for any confusion, OBN and Staffs. The “glitch” I sometimes get is when my service provider won’t let me get onto particular sites via poor connection or such like.

          I’m guessing a bit here but maybe your comments were subject to the “moderator”. I have had that happen before as well and I think these sites have to have them to ensure nothing inappropriate or libellous (as OBN mentions below) gets through. I hasten to add I am certainly NOT implying that either of you post such comments.

          Maybe Disqus itself ain’t working properly. However, please don’t quote me here as I am certainly no IT whizz kid.

          Does any of this help?

          • Oldbluenose says:

            Geoff S and Staffs;, I know exactly what you meant, when you said sometimes your provider cannot make connection with the OP, site, — It has happened to me a couple or so times.
            This was definitely Discus, [ acting as moderator ] but I was careful NOT to embarrass Daniel, by making inappropriate remarks, — So I was shocked to have it taken-off, ?.
            From one, [ no whiz kid, to another ] lol.

          • Geoff S says:

            It is obviously not in anybody’s interest to have legitimate postings taken off. Maybe Daniel might have a look at the problem if he gets a chance.

  • Richard Granfield says:

    Convertible bonds are most often issued by companies with a low credit rating and high growth potential according to Wikipedia!
    From the issuer’s perspective the key benefit of raising money by selling convertible bonds is a reduced cash interest payment. Another advantage is that if the bonds are converted to stocks a companies debt vanishes.

    • Geoff S says:

      This latest announcement must surely mean the involvement of Jeremy Wray and his friends won’t be getting off the ground. Or am I missing something?

  • Poppa999 says:

    Would be interesting to know if they are going to pay x3 what this PetroPro business is worth (usually do!)

  • Staffs Blue says:

    I enjoyed the game today. I thought it was a good workout. We easily bossed the first half, but I thought Cally upped their game in the second half and played some decent stuff. Both Novak’s and Gray’s goals were fizzers. I don’t think we used Duffy or Cotterill nearly enough after they came on, which left Donaldson a bit isolated, but apart from that, I have no complaints… except Randolph’s seagull impression when he conceded the goal. He’s our weak link methinks.

    We played 4-2-3-1 today, so I think that will be our away formation for the coming season, which in all fairness, helped towards a decent away record last season.

    • Steve says:

      Haven’t been today.tbh i can’t be arsed with pre season friendlies.Tattum said in the mail that that will be our away formation.Why not play the home formation today ?Anyway,roll on next week and lets get the proper football started.Hopefully the players are getting used to each other and we can get off to a good start,especially with a couple of home games in the first 3 games.

      • Staffs Blue says:

        Lee Clark invited Cally Thistle down basically because he felt they were the nearest to Middlesborough’s style of play. So I suppose it makes sense to see how the 4-2-3-1 would fare against that style. As it happened, it worked out quite well, so I suppose it justifies what Clark intention was. Apart from Randolph’s cock-up, we looked really comfortable throughout the game.

        • Steve says:

          I’ve just watched the highlights Staffs.Two cracking goals for us.I agree about Randolph.If he’s gonna come out for crosses,he has to flatten everybody around him and get something on the ball.There was no commitment when he came for that cross.Clark has a big decision to make about our keepers.I hope he makes the right one.

          • Staffs Blue says:

            I think there was a question mark about their goal anyway, albeit a little one. When the ball was dropping under the bar, Eardley was about to head it away, when two Cally players came racing in. One barged into Eardley, whilst the other headed the ball into the net. A foul? Maybe not, but I’ve seen ref’s blow up for less.

          • Staffs Blue says:

            Talking of Randolph… I had to laugh the other day, when he said he could still play for the USA. Well I don’t think his new Tim Howard look is gonna fool anyone. lol

          • Steve says:

            Looks like Tim Howard,plays like Frankie Howard :)

          • Staffs Blue says:

            Nice one. :-D

        • Blueboy88 says:

          Don’t think it is anything to do with Middlesborough , the friendly was arranged as part of the a Shinnie deal last year.

          • Chris W says:

            LC said in his notes that Callie play a similar style to Middlesbrough and it was a good test to see how the Blues shaped up. Could have been just a coincidence that we drew Middlesbrough opening day.
            KRO+DNM

          • Staffs Blue says:

            Only going on what I’ve heard and read. I’ve not seen any link to the Shinnie deal as yet.

    • Geoff S says:

      Blues will obviously find it tougher against Championship opposition week in and week out so, as Chris W recently noted, maybe we’ll get an idea of how this new Blues squad is shaping up after a dozen or so League matches.

      • Staffs Blue says:

        It’s gonna be a tough first game. It’s not a happy hunting ground for us. I’d settle for a draw now.

  • Staffs Blue says:

    There’s a piece in the BM this morning by Mel Eves. This is what he had to say:

    “I managed to speak to Peter Day, who is part of the consortium looking to buy into Blues, who are locked in discussions with the present owners. Peter couldn’t say too much as stock exchange rules prevent him from doing so. However, he did say that once the Hong Kong stock exchange are happy with the latest dealings announced this week by the club’s owners Birmingham International Holdings Ltd (BIHL) then this should clear the way to sorting out a deal.”

    Make of that what you will… but it does appear that talks are still ongoing.

    • Geoff S says:

      It is still “wait and see” (which is about what is has been for many, many months now).

    • Chris W says:

      Don’t they have to physically buy into this other company before they can sell part of BCFC, also , there is the other matter of the investigation by the KKSE into audits regarding how and from where monies were accrued?
      There still seems little information in the public domain regarding Petropro PT
      KRO+DNM

    • Steve says:

      Everybody knows what BIH are like with takeover talks.Why is Peter Day talking about it and why is Mel Eves reporting it ?

  • Art says:

    If true this is great news and it looks like negotiations are still continuing.

    Fingers crossed!

  • Blueboy88 says:

    If Mel Eves is to be believed this convertible bond issue is very very positive to the takeover happening sooner rather than later..

    http://www.birminghammail.co.uk/sport/football/football-news/aston-villa-birmingham-city-west-7554155?


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