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Cable & Wireless cuts conversion price on 5.75% notes; put option triggered on change of control
By Susanna Moon
Chicago, July 31 - Cable & Wireless Worldwide plc said the put option has been triggered on its £230 million of 5.75% convertible bonds due 2014 due to a planned change of control, and the conversion price will be lowered as well.
Holders may put their bonds at par plus accrued interest to but excluding the redemption date on Oct. 12.
The conversion price will be 88p from July 27 through Sept. 29, down from 102p, according to a company press release.
The adjustment was triggered by the offer to buy all of the issuer's shares by Vodafone Europe BV.
The trading of shares will be suspended from 2:30 a.m. ET on July 26 and then canceled from 3 a.m. ET on July 30, the release noted.
The company's shares closed at 37.92p on July 25.
Holders who exercise their conversion rights after 1 p.m. ET on July 25 will receive 38p in cash for each share to which they are entitled.
The company also said that if at any time conversion rights are exercised or purchases and redemptions made for 85% or more of the bonds originally issued, the issuer may redeem all of the outstanding bonds with 45 to 60 days' notice at par plus accrued interest to the redemption date.
BNP Paribas Securities Services, Luxembourg Branch is the paying and conversion agent.
Vodafone offer
Vodafone Group plc subsidiary Vodafone Europe BV said on May 21 that it was offering to purchase the 5.75% convertibles issued by Cable & Wireless.
The offer was connected to Vodafone's April 23 agreement to acquire Cable & Wireless, according to a previous press release.
Pricing was to be set using the 5% U.K. Treasury Gilt due 2014 plus a spread of 190 basis points, subject to a floor of par, at 9 a.m. ET on the day the merger condition was satisfied.
The offer was slated to end at noon ET on June 15, and settlement for within 14 days of the merger.
Cable & Wireless and Vodafone are telecommunications companies based in London.
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