China Water Industry Group Limited (1129) announced a conditional agreement, dated 16 February 2026, to issue convertible bonds with an aggregate principal amount of HK$278.25 million (equivalent to approximately RMB250.00 million). The company has secured five subscribers, each agreeing to subscribe in multiple tranches. The estimated net proceeds of approximately HK$277.50 million are intended to repay existing indebtedness, including those owed to International Finance Corporation (IFC).

According to the announcement, the convertible bonds carry an interest rate of 10% per annum and mature on the second anniversary of their respective issue dates. The initial conversion price is HK$0.308 per share, subject to customary adjustments. Upon full conversion, up to 903.41 million new shares could be issued, representing approximately 142.90% of the current share capital and approximately 58.83% on an enlarged basis. The maximum nominal value of these shares would be HK$90.34 million.

Completion of each tranche is contingent on various conditions, including obtaining necessary approvals at an extraordinary general meeting (EGM) and the granting of listing permission for the conversion shares by the Stock Exchange. The subscription schedule is designed to align with rescheduled repayment obligations, and the board believes this initiative will alleviate near-term liquidity pressures. The company expects to dispatch a circular on or before 20 March 2026 with further details, subject to EGM approval.