Singapore's Petra Foods begins consent solicitation, seeks waivers

By Angela McDaniels

Tacoma, Wash., Feb. 7 - Petra Foods Ltd. began a consent solicitation for its S$10 million of 4½% series 006 notes due 2013, S$52 million of 4½% series 007 notes due 2014, S$13 million of 5.15% series 008 notes due 2015, S$40 million of 4¾% series 009 notes due 2016 and S$70 million of 5% series 010 notes due 2017.

According to a company news release, Petra Foods is seeking noteholder approval to

• Waive the noncompliance with certain provisions of the trust deed;

• Waive the occurrence of certain events of default; and

• In the case of all but the series 006 notes, amend the trust deed to include a call option that would allow the company to redeem all (but not some only) of a series of notes at its option.

Covenant breaches

On Dec. 11, the company announced that its entry into a conditional sale and purchase agreement with Barry Callebaut AG and Barry Callebaut Belgium NV would result in covenant breaches and a potential event of default under the trust deed of the notes.

Under the purchase agreement, Petra plans to sell its cocoa ingredients division, its subsidiaries and associated companies.

Petra said it agreed that its principal subsidiaries will not dispose of all or substantially all of their assets.

Petra's board of directors said that noncompliance with the trust deed will not affect the company's ability to meet its payment obligations for the notes.

According to the latest news release, the company has successfully repaid its $5 million floating-rate notes and $9 million floating-rate notes on their respective maturity dates since the Dec. 12 announcement was made.

DBS Bank Ltd. and Lazard Asia Ltd. are the solicitation agents.

Petra Foods manufactures cocoa ingredients used in branded chocolate confectionery products and is based in Singapore.

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