KOKS extends exchange offer for 7¾% loan participation notes by a week

By Toni Weeks

San Luis Obispo, Calif., June 19 – KOKS Finance Ltd. announced it has extended the exchange offer in which it has offered to exchange any or all of its outstanding $350 million of 7¾% loan participation notes due June 23, 2016 for cash and new notes to 11 a.m. ET on June 26 from 11 a.m. ET on June 19, according to a press release.

Additionally, settlement will now occur on July 3 instead of June 26.

According to a previous filing with the London Stock Exchange, the company will issue new dollar-denominated 10¾% loan participation notes due 3.5 years from the settlement date and also pay a cash consideration amount equal to 20% of the total principal amount of existing notes accepted for exchange.

The new notes will be issued in an amount equal to 90.5% of the total principal amount of existing notes. To participate, noteholders must validly offer for exchange at least $221,000 of the existing notes such that the noteholder is eligible to receive as part of the exchange offer consideration a principal amount of new notes of at least $200,000.

KOKS will also pay accrued interest up to but not including the settlement date.

As previously reported, the borrower, JSC Koks, holds $35,859,000 of the existing notes and intends to offer them for exchange in the offer.

The borrower said it is seeking to reduce its debt service obligations due in the medium term and achieve a more-efficient maturity profile, which will provide the company with additional financial flexibility to pursue its business strategy and obtain more favorable funding terms for its planned capital expenditure projects.

Specifically, the issuer is making the offer to increase the amounts of available free cash in 2016 as well as to preserve working capital and finance the group’s capital expenditures program that is intended, among other things, to allow the group to achieve full self-sufficiency in key raw materials required in its operations.

Citigroup Global Markets Ltd. (+44 0 20 7986 8969, attn: Liability Management Group, or e-mail: liabilitymanagement.europe@citi.com), Renaissance Securities (Cyprus) Ltd. (+357 22 360 000, attn: Debt Capital Markets, or e-mail: Project.Inspiration@rencap.com) and CJSC Sberbank CIB (+7 495 787 2363 or e-mail: liability_management@sberbank-cib.ru) are the dealer managers. Citibank NA, London Branch (+44 20 7508 3867, attn: Exchange Team – Agency & Trust, or e-mail: exchange.gats@citi.com) is the exchange agent.

The company, a coke and pig iron producer and miner based in Moscow, began the exchange offer on June 11.

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