The Hong Kong-listed smartphone manufacturer Xiaomi is planning to launch a 8 billion yuan panda bond issue for funding the coronavirus or COVID-19 prevention efforts, its first issuance onshore, two sources have told Reuters.

The first 1 billion yuan tranche of private placement notes will have a fixed coupon and a tenor of three years, the sources said. They said that proceeds from the bonds will be used to repay interest on loans for projects within China, replenish working capital and support virus-fighting efforts.

Coronavirus relief

Coronavirus
Doctors speak with cured novel coronavirus pneumonia patients in Wuhan, central China's Hubei Province, Feb. 6, 2020. A total of 23 novel coronavirus pneumonia patients were cured and discharged from hospital on Thursday after integrated treatment with traditional Chinese medicine (TCM) and Western medicine. (Xinhua/Li He/IANS) Xinhua/IANS

Bank of China will be the lead underwriter and bookrunner on the deal, with Industrial and Commercial Bank of China as the joint underwriter, the sources said. Panda bonds are yuan-denominated bonds from non-Chinese issuers which are sold in China. Xiaomi did not immediately respond to Reuters' request for comment. Xiaomi said last week that it had resumed operations for more than 80% of its supply chain in the wake of China's coronavirus outbreak.

The Coronavirus outbreak has created a major stir around the world in recent times as it has claimed the lives of over 16,000 people and has infected over 380,000 people worldwide. The virus is spreading like wildfire and has infected people in over 150 countries.

(With agency inputs)