Eng - IOI Group

Notes To The Financial Statements cont’d34. LONG TERM BORROWINGS cont’d34.3 USD370 Million Zero Coupon Guaranteed Exchangeable Bonds due 2011 (“2 nd Exchangeable Bonds”) cont’dAt initial recognition, the 2 nd Exchangeable Bonds were recognised in the Group balance sheets as follows:GroupRM’000Face value 1,314,980Equity component (92,023)Deferred tax liability (34,036)Liability component on initial recognition 1,188,921The 2 nd Exchangeable Bonds exchanged during the financial year are as follows:GroupNominalValue of 2 ndExchangeableNo. ofBonds Exchange shares(USD) price issued Remarks2007Exchange prior to Share Split 18,907,000 RM23.50 2,848,111 Ordinary share of RM0.50 eachAdjustment pursuant to Share Split - - 11,392,444 Ordinary share of RM0.10 each18,907,000 - 14,240,555 Ordinary share of RM0.10 eachExchange after Share Split 23,475,000 RM4.70 17,681,156 Ordinary share of RM0.10 each42,382,000 - 31,921,711 Ordinary share of RM0.10 eachThe movement of the 2 nd Exchangeable Bonds during the financial year is as follows:Group Liability Equity DeferredComponent Component TaxRM’000 RM’000 RM’0002007At Initial recognition 1,188,921 92,023 34,036Exchange of USD42,382,000 nominal value of the 2 ndExchangeable Bonds (134,862) (10,541) (2,875)Interest expense 31,277 - (8,445)Foreign currency translation differences (34,229) - (940)At end of financial year 1,051,107 81,482 21,776205ANNUAL REPORT 2007IOI Corporation Berhad