Blue Star seeks expressions of interest in A$11.7m shareholders' notes
Blue Star Group is calling for non-binding preliminary expressions of interest from bondholders in investing in the A$11.7 million (NZ$14.9 million) of shareholders' notes issued in the company's recent restructuring.
Monday, October 3rd 2011, 10:13AM
by Jenny Ruth
The shareholders' notes rank ahead of the bonds but behind Blue Star's banks and will accrue interest at 18.5% a year with payment in one lump sum due on maturity, February 2015 when the bank loans, $140.5 million at June 30, are due to be repaid, barring other developments.
The opportunity to participate in the notes was one of the concessions offered bondholders to induce them to approve the restructuring deal which required them to exchange the $137.3 million in principal and interest they were owed for a package with a net present value of $44 million with even that return uncertain.
Under the original plan, the major shareholders, director Tom Sturgess and Australian private equity firm CHAMP who own 93.7% of Blue Star, were to have taken up all the shareholders' notes.
Bondholders approved the restructuring on August 10.
Blue Star chairman Nick Greiner says in a letter to bondholders that they are being offered a pro rata right to participate plus oversubscriptions and CHAMP's contribution will decrease in proportion to bondholders' take up of the offer.
Greiner says the company will make a further announcement of any formal offer once it knows the extent of bondholders' interest in participating.
Because of the substantial cost of a retail issue, including preparing offer documents, engaging a corporate trustee and due diligence audit and legal costs, "the board will be required to take these matters into account when assessing how to structure any formal offer follwing review of any expressions of interest received," Greiner says.
| « Telecom's retail bondholders overwhelmingly approve split | Allied Farmers delays annual report in hopes of positive event » |
Special Offers
Commenting is closed
|
|
Printable version |
|
Email to a friend |
