China Hongqiao, the country's largest private aluminum producer, is seeking to raise 10.2 billion yuan ($1.5 billion) through convertible bonds, according to deal terms reviewed by Bloomberg News. The issuance would allow bondholders to convert their debt into equity at a predetermined price, giving investors exposure to potential stock upside while the company secures capital.

The move places Hongqiao among a wave of corporations tapping capital markets as risk appetite improves. The timing follows a de-escalation of tensions in the Middle East, which has helped restore confidence among global investors. Convertible bonds have become an attractive financing tool for companies seeking to exploit improved market conditions without immediately diluting equity.

The deal underscores the broader reopening of China's credit markets after a period of caution. For Hongqillon, the funds provide flexibility to potentially refinance existing debt or invest in capacity as the aluminum sector benefits from industrial demand. The company's status as the nation's biggest private aluminum producer gives it considerable leverage in capital markets.