By Kenneth Lim
Boston, Nov. 10 - Sound Energy Trust on Wednesday repriced its downsized C$40 million of five-year convertible subordinated unsecured debentures for a coupon of 8% and an initial conversion premium of 14%.
The debentures were offered at par and may be converted into Sound Energy Trust common stock at C$6.10 per share.
The offering was originally a C$55 million offering priced at a coupon of 6.75% and an initial conversion premium of 15.85%.
There is now also an over-allotment option for a further C$6 million.
TD Securities, BMO Capital Markets, Canaccord Capital, FirstEnergy Capital, National Bank Financial and Tristone Capital are the underwriters of the deal, which will be registered in Canada.
Sound Energy is a Calgary, Alta.-based oil and gas income trust. It did not give a reason for the repricing, but the move comes amid term amendments at other Canadian income trusts, including Algonquin Power Income Fund and Enterra Energy Trust. Algonquin said it repriced its convertible deal in response to proposed changes to Canadian law that will increase taxes on income trusts.
Sound Energy said the proceeds of the deal will be used to reduce its outstanding debt, which may be redrawn and used for fund development and other general purposes.
| Issuer: | Sound Energy Trust
|
| Issue: | Convertible subordinated unsecured debentures
|
| Underwriters: | TD Securities, BMO Capital Markets, Canaccord Capital, First Energy Capital, National Bank Financial and Tristone Capital
|
| Amount: | C$40 million
|
| Greenshoe: | C$6 million
|
| Maturity: | Dec. 31, 2011
|
| Coupon: | 8%
|
| Price: | Par
|
| Yield: | 8%
|
| Conversion premium: | 14%
|
| Conversion price: | C$6.10
|
| Conversion ratio: | 163.9344
|
| Pricing date: | Nov. 9
|
| Settlement date: | Nov. 21
|
| Distribution: | Regulation S
|
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