Dishman Pharmaceuticals extends consent solicitation for 0.5% convertibles

By Jennifer Chiou

New York, June 6 - Dishman Pharmaceuticals and Chemicals Ltd. has prolonged its consent solicitation for holders of its $32.5 million of 0.5% foreign-currency unsecured convertible bonds due 2010 to June 20.

The company plans to make an investment of about Rs. 750 million for a new manufacturing plant in Bavla, India, and $12.5 million for one in China and needs bondholder consent in order to pledge the new assets as security for the loan and to issue guarantees in favor of other Dishman Group companies for the loan.

Out of the total investment, Dishman said that it will invest $5 million as share capital.

The company also plans to expand its existing facilities in Switzerland and the United Kingdom.

Previously, the company said that it intended to obtain a $25 million loan to build the plants.

Bondholders previously had to vote to grant or deny consent by April 30. The company began soliciting consents on Feb. 7.

As already reported, Dishman said the new securities granted to the lenders will exclude routine additional modifications made to the company's existing plant, which will continue to be under negative lien in favor of the bondholders.

The company issued $50 million of the notes in August 2005.

Dishman manufactures chemicals and active pharmaceutical ingredients and is based in Ahmedabad, India.

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