Chinese sovereign wealth fund China Investment Corporation CIC will invest $1.9 billion in high-yield debt issued by Indonesian miner Bumi Resources.
In a stock exchange filing yesterday, Bumi referred to the investment as a debt-like instrument. Of the $1.9 billion invested, $600 million is repayable in year four, $600 million in year five and the remaining $700 million in year six. Bumi will pay CIC a coupon of 12% annually plus an amount at final maturity such that the investment will yield CIC an internal rate of return IRR of 19%.
China Investment Corporation CIC is responsible for managing part of China's foreign exchange reserves and has $200 billion of...
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