JUN. 11 '87 10:46 IMF WASH DC RAPICOM6300 477-7491
P.008
FOR OFFICIAL USE ONLY
HONG KONG
JE CHINA INVESTMENT COMPANY LTD.
AND
JF CHINA MANAGEMENT COMPANY LTD.
SUMMARY
INVESTMENT:
Subordinated Loan Stock:
Equity:
PROJECT DESCRIPTION:
(1) US$3.0 million, repayable out of profits, zero
interest rate, subordinated to principal and interest payments on senior debt.
(2) US$30,000 to purchase 12% of the common shares
of JF China Investment Company Ltd. (CIC)
(3) Up to US$7,500 to purchase 10%1/ of the common
shares of JF China Management Company Ltd. (CMC)
Project promotion and investment company with an initial capital of US $20,000,000.
OWNERSHIP & MANAGEMENT: CIC will be owned by:l/ Jardine Fleming Holdings
RISKS:
Ltd. of Hong Kong (1); Kuwait Investment Authority (20%); IFC (12%); CMC (20%); and Others (36%). CMC will be owned by: Jardine Fleming Holdings Ltd. (75%), Kuwait Investment Authority (10%); IFC (10%) and CMC's Managing Director (5%).
The new Company must successfully identify and invest in a sufficient number of attractive projects in China to meet its costs and generate an adequate return to its lenderafshareholders,
Financial
RATE OF RETURN:
Economic Equity
19.22 N.A.
(the debt and equity are considered
as ons in this investment)
1/ As noted in the body of the report, the Sponsor's original intention was
to establish a company with an initial capital of approximately US$ 20 million. However, a large number of prospective investors have indicated an interest to participate in the Company. If all of these confirm their desire to participate, the total capital would be increased to a maximum of approximately $30 million. In the case of IFC's investments in CIC (item (1) and (2) above) the absolute amount of the investments would be fixed (US$3 million for Subordinated Loan Stock and US$30,000 for shares in CIC). IFC's investment in CMC (Item (3) above) would be 10% of that company's share capital. Therefore, if CIC's total capital is approximately US$20 million then IFC's investment in CMC would be US$5,000. If the total CIC capital is raised to approximately US$30 million, then IFC's investment in CIC would be US$7,500. The ownership percentages in CIC referred to above assume that the total capitalization of CIC is approximately US$20 million.
This document has a restricted distribution and may
used by recipients only in the performance of their official duties. Its contents may not otherwise lis disclosed without IFC authorization.