Macquarie Communications to repay both tranches of exchangeables

By Jennifer Chiou

New York, Oct. 31 - Macquarie Communications Infrastructure Group announced that it will repay about A$780 million of obligations over the next three years, including the redemption of both tranches of its exchangeable bonds.

The company noted that it will not need an asset sale or new issue for the repayments.

"The boards and management of MCG are acutely aware of the impact of MCG's sustained security price decline and the importance of distributions. However, there has also been a strong desire by investors for MCG to address the remaining exchangeable bonds, which have early redemption dates in May 2010 and August 2011 and are seen to pose a risk of significant dilution to existing equity holders," chief executive officer Scott Davies said in a news release.

The company recently said it repurchased A$31 million more of its 2.5% guaranteed exchangeable bonds due 2012 at a cost of A$24 million between Sept. 2 and Oct. 28. The company said it bought back the bonds at prices between 76 and 79.5, with a weighted-average price of 78. The repurchased bonds will be canceled.

On Sept. 2, the company said it accepted A$309 million of its A$725 million of 2.5% exchangeables due 2012 and $89 million of its 2.5% guaranteed exchangeable bonds due 2013 in a tender offer. Noteholders received 91 for the exchangeables due 2012 and 89 for the exchangeables due 2013, plus accrued interest in each case. Settlement was on Sept. 16.

Macquarie Communications is a Sydney, Australia-based infrastructure fund run by Macquarie Bank.

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