China Nickel Resources Holdings is raising HK$1.5 billion via zero-coupon convertible bonds, a source close to the deal said on Tuesday.

The bonds due in 2012 will convert at HK$5.72-HK$5.94 per share, representing a premium of 35 to 40 percent to the reference price.

It will have a HK$500 million greenshoe option.

Credit Suisse and Deutsche Bank are bankers to the issue.

The proceeds will be used for expansion in China and Indonesia and general capital purposes.

Earlier this month, a newspaper report said China Nickel plans to invest at least 6 billion yuan in the next five years to expand its stainless steel business, mainly in Indonesia.

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