Updates with further details from paragraph 2

June 18 (Reuters) - Computer maker Lenovo Group 0992.HK said on Thursday it would issue $2 billion of zero-coupon convertible bonds due 2033 and use part of the proceeds to refinance debt, including buying back some existing notes.

Lenovo entered into a bond subscription agreement on Wednesday under which managers will subscribe for, or place, the bonds with professional investors.

The securities carry no coupon and are convertible into shares at an initial price of HK$36.70 per share, subject to adjustments, the company said.

Lenovo plans to use the proceeds to refinance existing indebtedness, including a concurrent repurchase of its $675 million 2.50% convertible bonds due 2029, as well as for share buybacks and general corporate purposes.

Lenovo also intends to conduct on-market share buybacks after completion of the bond offering and repurchase, aiming to offset dilution from the conversion of new bonds and achieve a neutral impact for existing shareholders.

Lenovo said the remaining outstanding principal on the 2029 bonds stands at about $450 million and that it will fund the repurchase using proceeds from the new bond issue.