By Rebecca Melvin
New York, Oct. 8 - Lonrho plc priced $60 million five-year convertible bonds at par to yield 7% with a 25% initial conversion premium above the three-day volume weighted average price of shares on the London Stock Exchange ending Thursday, according to a news release.
There is a $10 million over-allotment option.
The bonds came at the midpoint of coupon talk, which was 6.5% to 7.5% coupon, and at the cheap end of 25% to 30% premium talk.
Subject to approvals from Jersey regulators and an Oct. 29 shareholder meeting, the bonds will be redeemable for preference shares of Lonrho's LAH Jersey Ltd. subsidiary, the issuer of the bonds, and exchangeable immediately upon issuance for ordinary shares in the company.
The initial conversion price is £0.1559 per share listed on the AIM market of the London Stock Exchange.
Pricing will be translated at an exchange rate of US$1.5866 per British pound.
The bonds will be non-callable for three years and then provisionally callable subject to a 130% price hurdle.
ISM Capital LLP is the bookrunner and manager of the offering, with Panmure Gordon (UK) Ltd. acting as co-manager.
Proceeds will be used to repay debt, to fund general working capital and to accelerate growth. The company will place the equivalent of two years coupon in escrow.
Settlement and delivery is expected by Oct. 15.
Application will be made to list the bonds on the official list of the Luxembourg Stock Exchange and to be admitted to trading on the Euro MTF Market of the Luxembourg Stock Exchange.
The company's shares trade on the AIM market of the London Stock Exchange.
Based in Liverpool, England, Lonrho has a portfolio of investments in infrastructure, transportation, support services and hotels.
| Issuer: | LAH Jersey Ltd.
|
| Guarantor: | Lonrho plc
|
| Issue: | Convertible bonds
|
| Amount: | $60 million
|
| Greenshoe: | $10 million
|
| Maturity: | Five years
|
| Bookrunner: | ISM Capital LLP
|
| Co-manager: | Panmure Gordon (UK) Ltd.
|
| Coupon: | 7%
|
| Price: | Par
|
| Yield: | 7%
|
| Conversion premium: | 25%
|
| Conversion price: | £0.1559 per share
|
| Calls: | Non-callable for three years, then provisionally callable subject to a 130% price hurdle
|
| Price talk: | 6.5%-7.5%, up 25%-30%
|
| Pricing date: | Oct. 8
|
| Settlement date: | Oct. 15
|
| Stock symbol: | London: LONR
|
| Market capitalization: | £166.98 million
|
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