First Pacific deposits funds to redeem remaining $130 million convertibles

New York, Jan. 31 - First Pacific Co. Ltd. said it deposited sufficient funds to redeem the remaining $130 million principal amount of its convertible bonds.

The company's action followed a series of repurchases which resulted in $68 million of securities being bought back at a cost of $91 million.

First Pacific's remaining bonds mature on March 27, 2002 and First Pacific will have to pay $176 million at that point, including interest and the redemption premium. The necessary money has now been placed with a trustee, the company said.

Funding for the repurchases and redemption came form $92 million of cash on hand and $189 million drawn down from First Pacific's HK$1.56 billion ($200 million) credit facility.

First Pacific issued $350 million of the five-year convertibles in March 1997 through its First Pacific Capital (1997) Ltd. unit. The securities pay a coupon of 2% and can be converted until March 2002 at a price of HK$12.25 per share. They are redeemable at 134% of face value.

The company first announced a tender then decided to buy the bonds back in the open market after a property company told First Pacific's Larouge unit it will be unable to repay a $90 million loan.

First Pacific said its action was "in order to allay any convertible bond repayment concerns that might exist as a result of this development."

The loan problem concerns Philippine property company Metro Pacific Corp., which borrowed $90 million from First Pacific's Larouge unit in April 2001. The loan was due Dec. 31, 2001 and was secured by a pledge of Bonifacio Land Corp. shares owned by Metro Pacific.

First Pacific said Larouge will now co-manage with Metro Pacific the sale of Metro Pacific's 69.6% controlling stake in Bonifacio Land Corp., a joint venture with the Philippine Government to redevelop part of Manila's business district. MPC is also working on a plan to reduce its debt, to be announced no later than the end of February.

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