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McDonald's Dishes Out Yuan Bonds, Eyes China Expansion

The McDonald's restaurant chain is raising money using China's yuan currency instead of U.S. dollars.

The world's largest fast-food company sold $29 million worth of yuan-denominated bonds in Hong Kong on Thursday. McDonald's said this is the first time a multinational company has sold bonds using China's currency.

The president of McDonald's Asia-Pacific, Middle East and Africa division, Timothy Fenton, said the money will be used to expand the company's presence in China. McDonald's already has 1,100 stores in mainland China and more than 60,000 employees. It plans to open at least another 150 restaurants in China this year.

Earlier this month, the restaurant chain said its sales rose 7 percent in July due in part to strong performance by its Asian stores.

The McDonald's bonds were sold to institutional and professional investors with a 3 percent interest rate and will mature in three years. Companies often sell bonds to raise money. During a bond sale investors essentially loan money to a company for a defined period of time. At the end of the period, the company pays back the loan with interest.

Some information for this report was provided by Reuters.