BioProgress repurchases £5 million in convertible bonds

By Sheri Kasprzak

Atlanta, June 1 - BioProgress plc said it has redeemed £5 million in unsecured convertible bonds.

The company repurchased the bonds, which were issued to a major institutional investor, according to a statement, on Oct. 6, 2004. The bondholder had been granted an option to buy additional bonds up to Oct. 6, 2006, but that option has been cancelled.

The bonds bore interest at 4% annually and were to mature in five years.

The bonds will be repurchased for £3.3 million, £1.65 million of which will be in cash and the remainder of which will be satisfied by the issue of 4,285,714 shares. The number of shares to be issued is based on the price per share of 38.5p, a 1.3% premium to the company's closing stock price on May 31.

"As part of the strategic and financial review, we decided that we wanted to remove this liability from our balance sheet in order to give greater financial flexibility and certainty as we take the business forward," said company chief executive officer Richard Trevillion in a statement. "We therefore approached the bondholder with the aim of making a mutually beneficial offer for the bonds, and I am delighted that we have been able to reach this agreement, which represents a discount of approximately 34% to the face value of the bonds."

Based in Cambridgeshire, England, BioProgress develops oral delivery products for the pharmaceutical industry.

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