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IT firm Xero launches $850 million convertible notes offering due 2031

(Reuters) - Software service company Xero on Tuesday announced it is raising $850 million by offering fixed coupon guaranteed senior unsecured convertible notes that are due to be repaid by 2031.

The move follows a recent surge in convertible bond offerings, including deals from Alibaba worth $4.5 billion and notable issues from Lenovo and JD.com amounting to $2 billion and $1.5 billion, respectively.

On Monday, Bloomberg News reported that Chinese developer Poly Developments and Holdings Group was considering a sale of convertible bonds worth $1.7 billion.

Xero said in its statement that it plans to list the notes on the Singapore stock exchange.

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The net proceeds will be used to repurchase its existing notes and for potential acquisitions and investments, the IT firm added.

Xero said that its subsidiary, Xero Investments, was conducting a reverse bookbuilding process to attract investors for the company's $700 million buyback programme of existing convertible bonds.

(Reporting by Poonam Behura in Bengaluru; Editing by Eileen Soreng)