IGas Energy gets 100% votes to restructure bonds at meeting

By Susanna Moon

Chicago, April 3 – IGas Energy plc said it secured unanimous approval for its planned capital restructuring from its secured and unsecured bondholders at a meeting.

As a result, the restructuring of the company's secured bonds and unsecured bonds will become effective on Tuesday, according to a company update.

The company said on March 10 that it would breach its bond liquidity covenants in late March unless the revised restructuring went through.

At that time it had the support of 66 2/3% of the secured bondholders and about 40% of the unsecured bondholders.

Then the company said on March 17 that it had increased its backing to about 75% of the secured bondholders and about 61% of the unsecured bondholders.

The bondholder transactions had to be approved by at least of 66 2/3% of the voting secured bonds and of 66 2/3% of the voting unsecured bonds. To form a quorum, at least 50% of the secured bondholders and 50% of the unsecured bondholders needed to be represented at the bondholder meeting.

IGas also said it closed a placement of $55 million from a subscription by new investor Kerogen, a placement of shares with institutional investors and a subscription by some of the directors.

The size of the placement was increased from $35 million.

As part of the restructuring, the company held a debt for equity swap for all of the unsecured bonds through a bondholder vote as well as a debt for equity swap for some of the secured bonds through a voluntary equity exchange or bondholder vote.

The company said on March 31 that it will buy back $49.2 million of secured bonds in the cash portion of its offers to restructure its debt.

Holders had tendered $71.4 million principal amount of bonds in this part of the offer after adjustment for the mandatory equity exchange.

Settlement is expected to take place on April 7.

IGas said that because the minimum cash cancellation level of $49.2 million has been met there will be no conditional cash cancellation.

The company previously announced on March 24 that it received and planned to accept offers for $28,918,390 principal amount of secured bonds in the voluntary equity exchange.

Settlement of this portion of the transactions was expected to occur around April 7.

The secured bonds will convert to equity at 100% of par.

Because the $39,999,999 minimum conversion threshold was not met, $11,081,609 principal amount of secured bonds will be converted into new ordinary shares of the company under the conditional secured debt for equity swap if the restructuring is completed.

The secured bond cash cancellation minimum for the voluntary cash offer is $30 million, because the secured bond conversion minimum was not reached.

IGas is a London-based onshore hydrocarbon producer, delivering natural gas and crude oil to Britain’s energy market.

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