Suzlon rethinking FCCB offer terms
05 May 2009
India's biggest maker of wind-turbine generators, Suzlon Energy Ltd, says it is evaluating options on an offer to change the terms of $500 million of foreign currency convertible bonds after some debtors rejected the plan.
Holders of five-year bonds issued in June 2007 passed the amendment resolution at a meeting on 29 April, while investors in bonds issued in October 2007 didn't approve the proposal, Suzlon said in a statement to the Bombay Stock Exchange today.
Suzlon issued zero coupon bonds worth $300 million and $200 million, due in June 2012 and October 2012 respectively, to help finance the acquisition of Hamburg-based REpower Systems AG. The wind-turbine maker has to complete the purchase of additional shares in Repower from Portugal's Martifer SGPS SA this month.
The Ahmedabad-based company proposed the changes in a bid to reduce its liabilities. Suzlon offered to swap new bonds for old, a cash payment or a combination, according to a statement issued to stock exchanges on 31 March.
The conversion price for new bonds that may be issued to debt holders as an incentive to agree to the proposed changes was set at Rs76.6755 rupees a share at an exchange rate of Rs49.8112 a dollar, Suzlon said in a statement to the stock exchange on 27 April.
Suzlon Energy paid Martifer 30 million euros ($40 million) as part payment for a stake in Repower on 30 April, the Portuguese company said in a statement on its website. The Indian company needs to pay the remaining 175 million euros to complete the purchase of the 22.4-per cent stake.
The company said, ''It is currently evaluating its options in relation to the offer. The company reserves the right to waive, in its sole direction, either or both minimum consent conditions up to a settlement date.''
Suzlon said last week its stake in REpower has increased to 76 per cent after paying Martifer. Its shareholding will rise to 91 per cent after the remaining amount is paid.