By Kenneth Lim
Boston, March 30 - Mercator Lines (Singapore) Pte. Ltd. on Wednesday sold $51 million pre-IPO convertible bonds split into a $35 million tranche of two-year zero-coupon mandatory convertible bonds and a $16 million series of five-year 2.5% convertible bonds.
Silverdale Services Ltd. was the lead manager for the Regulation S offering.
Mercator Lines (Singapore) is a subsidiary of India's Mercator Lines Ltd. and plans to list on the Singapore Exchange.
The zero-coupon bonds must be converted into the common stock of Mercator Lines (Singapore) in the event of an initial public offering of the company within the first two years. The initial conversion price will be set at a discount, which will be the higher of a 15% rate-of-return for the bondholders or a 10% discount to the proposed IPO price.
The 2.5% bonds are convertible into the company's stock 45 days after the company is listed. The initial conversion premium will be 10% above the 45-day volume weighted average price of the shares at that point.
Mercator Lines (Singapore) is the main operating subsidiary of the Bombay-listed parent company and provides offshore vessel chartering and bulk carrier services. It did not say how it will use the proceeds of the offerings.
| Issuer: | Mercator Lines (Singapore) Pte. Ltd.
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| Bookrunner: | Silverdale Services Ltd.
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| Listing: | Singapore Exchange
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| Pricing date: | March 28
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| Distribution: | Regulation S
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|
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| Two-year bonds
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| Amount: | $35 million
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| Issue: | Mandatory convertible bonds
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| Maturity: | March 30, 2009 or upon IPO
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| Coupon: | 0%
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| Price: | Par
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| Conversion premium: | The lower of an amount that yields a 15% rate of return or 10% discount to the IPO price
|
|
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| Five-year bonds
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| Amount: | $16 million
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| Issue: | Convertible bonds
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| Maturity: | March 14, 2012
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| Coupon: | 2.5%
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| Price: | Par
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| Conversion premium: | 10% over initial 45-day volume weighted average price after IPO
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