By Abigail W. Adams
Portland, Me., June 20 – Petropavlovsk plc priced $125 million of five-year convertible bonds at the midpoint of talk with a coupon of 8.25% and an initial conversion premium of 22.5%, according to a company news release.
Price talk was for a coupon of 8% to 8.5% and an initial conversion premium of 20% to 25%.
The bonds will be issued by Petropavlovsk 2010 Ltd.
Gazprombank, JPMorgan, Renaissance Capital and VTB Capital are joint bookrunners for the Regulation S offering.
The amount of the issue includes $25 million from a fully exercised greenshoe.
The bonds are callable if 80% or more of the principal amount has been converted, repurchased or canceled.
They will include covenants limiting the company’s debt and asset sales.
The bonds will be exchangeable into ordinary shares using the prevailing U.S. dollar to pound sterling spot rate of 1:0.7916.
Concurrently with the pricing of the new offering, the company is repurchasing the $100 million outstanding of its 9% convertible bonds due March 18, 2020 at a purchase price of $1,080 per $1,000, in addition to accrued interest, which is expected to be $3.75 per $1,000.
The company may also repurchase the existing bonds outside of the repurchase offer through the open market or privately negotiated transactions.
The company is also seeking consent solicitations to enable the redemption of the existing bonds following the completion of the repurchase.
Closing of the new offering is contingent on either the tender of all outstanding existing bonds or 75% or more of holders of the outstanding bonds approving the consent solicitation.
Proceeds from the new bond offering will be used in part to fund the repurchase of the outstanding bonds and for the construction of a floatation facility at the company’s Pioneer mine, which is expected to cost $25 million to $30 million.
Petropavlovsk is a London-based gold mining company with operations in Russia.
| Issuer: | Petropavlovsk 2010 Ltd.
|
| Securities: | Convertible bonds
|
| Amount: | $125 million
|
| Maturity: | July 3, 2024
|
| Bookrunners: | Gazprombank, JPMorgan, Renaissance Capital and VTB Capital
|
| Coupon: | 8.25%
|
| Price: | Par
|
| Yield: | 8.25%
|
| Conversion premium: | 22.5%
|
| Conversion price: | $0.135
|
| Call options: | If 80% or more of outstanding bonds have been converted, redeemed or canceled
|
| Pricing date: | June 20
|
| Settlement date: | July 3
|
| Distribution: | Regulation S
|
| Talk: | Coupon of 8% to 8.5% and an initial conversion premium of 20% to 25%
|
| Stock symbol: | LON: POG
|
| Stock price: | £9.26
|
| Market capitalization: | £307.85 million
|
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