Xtep International of China is selling two tranches of convertible bonds to entities controlled by Hillhouse Capital to finance an international relaunch of the K-Swiss and Palladium brands, which it took over from E-Land Footwear in 2019. Hillhouse, which is controlled by the Chinese billionaire Zhang Lei, knows the industry well as it took over Belle International in 2017 and then spun off its retail business, Topsports, in a public offering two years later. Priced in Hong Kong dollars, the first tranche of bonds issued by Xtep has an aggregate principal of HK$500 million (€53.1m-$64.4m) bearing interest of 2.8 percent a year. Maturing in 2027, it is convertible into Xtep shares for HK10.22 per share. The second tranche is issued by Xtep Global, the Xtep subsidiary that actually owns K-Swiss and Palladium. Denominated in U.S. dollars, the $65 million offering yields no interest, but is convertible into a 20 percent stake in Xtep Global, which bought the two brands two years ago for $260 million.