Guming to raise $250 million through zero-coupon convertible bond issue

Bubble tea chain Guming Holdings Ltd. (1364.HK) saidon Wednesday it plans to issue HK$1.96 billion ($250 million) in zero-coupon guaranteed convertible bonds and launch a share buyback to improve its capital structure and support expansion.

According to the announcement, the bonds will be issued at 101% of their principal amount and mature in June 2027. The initial conversion price is HK$23.54 per share, representing a 15.5% premium to the stock’s June 23 closing price of HK$20.38. If fully converted, the bonds would be exchangeable for approximately 83.26 million shares, representing about 3.43% of the company’s enlarged share capital.

Guming expects to receive net proceeds of HK$1.96 billion after expenses. The funds will be used primarily to procure raw materials, including fresh fruits, fruit juice and coffee beans, as well as for equipment purchases such as coffee machines in China and overseas. Proceeds will also be used to repay certain borrowings, fund share repurchases, support digitalization and R&D initiatives, and for overseas expansion.

The company announced it will also repurchase approximately 34 million shares at HK$20.38 apiece, with the repurchased shares to be cancelled. Management said the buyback would facilitate hedging activities by convertible bond investors, reduce potential selling pressure in the market and partly offset future dilution from bond conversions.

Guming went public in Hong Kong in February last year. According to its latest annual results, its revenue rose 46.9% year-on-year to 12.9 billion yuan ($1.8 billion) in 2025, while its profit more than doubled to 3.11 billion yuan. At the end of last year, the company operated 13,554 stores, up 36.7% from a year earlier.

Guming shares opened lower on Wednesday but rebounded to trade at HK$20.52 by the midday break, up 0.69%. The stock has more than doubled since its IPO.

By Lee Shih Ta

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