Marconi redeems portion of 10% notes

New York, Oct. 3 - Marconi Corp. plc said that it plans to redeem $28,916,278 (£17.3 million) of its 10% guaranteed junior secured notes due 2008 - the third such redemption transaction since the notes were originally issued as part of the company's reorganization earlier this year.

Marconi said that the notes will be redeemed on Oct. 17 at a price of 110% of their principal amount, plus 77 days of accrued interest up to the redemption date.

Marconi will use the same pro ration "pool factor" mechanism used for the previously announced note redemption, which was completed as scheduled on Sept. 30.

The latest redemption will reduce the amount of outstanding notes to $288.7 million (£172.9 million) from $317.6 million (£198.9 million).

The company said that the mandatory partial redemption primarily results from the previously disclosed sale of Marconi's stake in Bookham Technology plc.

Marconi said that on the redemption date, the redemption price, together with accrued interest and any applicable additional amounts (as defined in the notes' indenture), would become due and payable.

As previously announced, Marconi, a London-based communications electronics company which emerged this past May from bankruptcy proceedings in the U.S. and the U.K., said on Sept. 16 that it would redeem $103,195,433 (£64.6 million) of its 10% notes on Sept. 30 at 110% of their principal amount.

The company also said that holders would also receive 60 days of accrued interest up to the redemption date, plus any additional amounts.

Marconi said that in line with the mechanism used for the previous partial redemption of the notes, which took effect on July 31, a pool factor (i.e. a pro ration arrangement) would be applied to every holding. It said further details of the pool factor to be applied from the redemption date would be announced once the pool factor had been confirmed by the registrar.

When it emerged from bankruptcy, Marconi issued $717.1 million of the new notes, equivalent to £450 million. After taking into account the July 31 partial redemption, it said that the latest transaction would further reduce the principal amount of notes outstanding to $317.6 million (£198.9 million).

The company said the redemption would be funded from the proceeds of Marconi's previously disclosed sale of its remaining stake in Easynet Group plc, its entire stake holding in Gamma Telecom Holding Ltd, and the release of collateral following expiry of certain performance bonds and letters of credit.

The paying agent for the redemptions is The Bank of New York's office in London (call Emma Wilkes at +44 20 7964- 7662). Bank of New York is also the registrar and the depositary for the transactions.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.