Sherritt buys back C$50 million of 7% convertibles in tender

By Angela McDaniels

Seattle, Oct. 26 - Sherritt International Corp. purchased C$50 million of its outstanding 7% convertible unsecured subordinated debentures due 2013 on Thursday, according to a company news release.

The company paid C$1,610 per C$1,000 principal amount of debentures plus accrued interest, the high end of the range it said it would accept.

Sherritt began a tender offer on Sept. 13 in order to buy back up to C$50 million of the notes ahead of the first call date on Dec. 16.

The offer was conducted by way of a Dutch auction, which expired on Monday.

Sherritt said the auction elicited tenders from holders of C$116 million principal amount of debentures. Accordingly, the company purchased tendered debentures on a pro rata basis of 43.08%.

The Toronto coal producer said previously that the purchase price would not be less than C$1,470 and not more than C$1,610 for each C$1,000 principal amount of debentures. This price range represents a premium of up to 10% of the closing price of the debentures on Sept. 12.

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