Singapore’s Halcyon seeks to amend 6˝% notes ahead of acquisition

By Wendy Van Sickle

Columbus, Ohio, April 4 – Halcyon Agri Corp. Ltd. has begun a consent solicitation to amend its S$125 million of 6˝% notes due 2019, series 001, according to a notice.

The company seeks to amend the notes trust deed dated April 25, 2014 in connection with an anticipated acquisition that would see Sinochem International Corp. become the majority owner of Halcyon.

Halcyon seeks to suspend the financial covenants from the financial quarter ended March 31 through July 31, 2017 and to waive any non-compliance with the covenants for the quarter ended March 31. These financial covenants will be restored on Aug. 1, 2017, or earlier if the proposed acquisition is aborted or if a change of control fails to occur on or before Dec. 31, 2016.

Despite its seeking to suspend the covenants, Halcyon said it believes it has sufficient cash flow to continue servicing payments on the notes.

To provide assurance to noteholders, Halcyon will make deposits into the notes’ trust account equal to the interest due for one interest period on July 31 and on Sept. 30, 2016 if the acquisition is not completed by those dates.

The company said it believes that suspending the financial covenants until Aug. 1, 2017 would give it time to integrate GMG Global Ltd and the natural rubber processing facilities and trading businesses of Sinochem International (Overseas) Pte. Ltd. with which Halcyon will combine.

The company is offering a consent fee of S$1,125 per S$250,000 in principal amount to noteholders who deliver voting instructions in favor of an extraordinary resolution containing the proposed changes by the early acceptance fee deadline of 5 a.m. ET on April 19.

The company will pay S$625 per S$250,000 in principal amount to noteholders who deliver consents after the early deadline but prior to the expiration of 10 p.m. ET on April 24 or who deliver their consents at the meeting, which will be held at 10 p.m. ET on April 26 in Singapore.

Payment of the consent fee is conditioned upon passage of the extraordinary resolution.

To establish a quorum, two or more holders of a clear majority of the principal amount of notes must be represented at the meeting. In order for the extraordinary resolution to pass, it must receive at least 75% of the votes.

DBS Bank Ltd. (656 222-4261) is the solicitation agent.

Tricor Singapore Pte. Ltd. (656 236-3550 or 656 236-3555) is the meeting agent.

Halcyon is a rubber company based in Singapore.

© 2015 Prospect News.
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