Vedanta to sell $775 million seven-year convertible bonds to yield 3.5%-4%, up 35%-40%

By Rebecca Melvin

New York, March 2 - Vedanta Resources Jersey II Ltd., a subsidiary of Vedanta Resources plc, launched an offering of about $775 million of seven-year convertible bonds Tuesday that will be sold at par and are expected to yield between 3.5% to 4%with an initial conversion premium of 35% to 40%, according to a news release.

The Regulation S bonds have a greenshoe for up to an additional $75 million of bonds.

J.P. Morgan Cazenove and Morgan Stanley are acting as joint bookrunners for the offering. J.P. Morgan Cazenove is a marketing name for the U.K. investment banking business of J.P. Morgan Securities Ltd.

Proceeds are intended to refinance debt redemptions and for general corporate purposes.

Priority in allocation of the bonds will be given to existing shareholders, but Volcan Investments Ltd., majority shareholder of the company, has indicated it will not participate in the transaction.

Settlement is expected to take place around March 30.

The bonds will be non-callable for three years and provisionally callable thereafter if shares exceed 130% of the volume weighted average on the London Stock Exchange over a certain period.

In addition, the company has the right to redeem the bonds if the total principal amount outstanding falls to 15% or less of the initial issue size.

Holders can put the paper at par in years three and five and in the event of a change of control.

The company is applying to list the bonds on the London Stock Exchange's official list for trading on the professional securities market.

Vedanta is a London-based metals and mining company with operations in India, Zambia and Australia.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.