InterOil asks holders to approve amended restructuring under 15% bonds

By Susanna Moon

Chicago, Nov. 1 - InterOil Exploration & Production ASA is seeking bondholder approval to amend its 15% senior callable bonds due 2014 with a meeting set for Nov. 18 in Oslo.

The company is asking for an amended restructuring under the bonds after regulatory issues prevented completion of the restructuring that was approved in July, according to a notice from trustee Norsk Tillitsmann ASA.

Instead, the company will hold both its Peruvian and Colombian activities through Interoil Exploration & Production Latin American AS, which was the holding company for activities in Peru and Colombia. The purpose of the initial restructuring was to separate the activities in Peru and Colombia into two separate, wholly owned subsidiaries.

As a result, bondholders will be asked to approve the amended restructuring at the meeting, as well as change the definition of subsidiaries by including UP Colombia Holding AS and deleting delete interoil Peru Holding AS.

In order to have a quorum, at least half of the bonds needed to be represented at the meeting. In order for the measure to pass, the holders of at least two-thirds of the bonds represented at the meeting needed to vote in favor of the proposal.

Background, recent approval

As previously announced, InterOil bondholders voted unanimously to amend the company's 15% senior callable bonds due 2014 at a meeting held in Oslo on July 17.

Bondholders were asked to consider the following proposals at the meeting:

• Restructuring InterOil Peru Holding ASA to be incorporated as a 100% owned subsidiary of InterOil and the holding company for the shares in InterOil Peru SA and North Oil Services SAC;

• The establishment of security interest in InterOil Peru Holding and InterOil Peru SA;

• Changing the definition of "subsidiaries" to include InterOil Peru Holding; and

• Changing the definition of "share charge" to align the bond agreement with a proposed share pledge in which InterOil and InterOil Peru Holding will use reasonable endeavors to establish a new pledge in favor of the bond trustee directly over InterOil Peru Holding's shares in InterOil Peru SA.

InterOil is an Oslo-based exploration and production company.

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