By Stephanie N. Rotondo
Seattle, June 1 – Algoma Central Corp. announced a C$75 million bought-deal offering of 5.25% convertible unsecured subordinated debentures due 2024 on Thursday.
CIBC Capital Markets is the lead bookrunner.
There is a C$7.5 million over-allotment option.
Holders may convert their paper into common stock at any time prior to maturity at a conversion price of C$21.15. That represents an initial conversion premium of 60%.
The debentures become redeemable on June 30, 2020, if the stock hits a 125% price hurdle. On or after June 30, 2022, the company can redeem the issue at any time.
The redemption price is par plus accrued interest.
Proceeds will be used to fund the redemption of Algoma’s 6% convertible unsecured subordinated debentures due March 2018 and for general corporate purposes.
Algoma is a Saint Catharines, Ont.-based operator of dry and liquid bulk carriers.
| Issuer: | Algoma Central Corp.
|
| Securities: | Convertible unsecured subordinated debentures
|
| Amount: | C$75 million
|
| Greenshoe: | C$7.5 million
|
| Maturity: | June 30, 2024
|
| Bookrunner: | CIBC Capital Markets
|
| Coupon: | 5.25%
|
| Price: | Par of C$1,000
|
| Yield: | 5.25%
|
| Conversion premium: | 60%
|
| Conversion price: | C$21.25
|
| Call options: | On or after June 30, 2020 if the stock hits a 125% price hurdle; on or after June 30, 2022 at any time. In either case, redemption price is par plus accrued interest
|
| Pricing date: | June 1
|
| Settlement date: | June 21
|
| Stock symbol: | TSX: ALC
|
| Stock price: | C$13.19 as of June 1 close
|
| Market capitalization: | C$513.25 million
|
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