Helsinki,Finland, 2011-11-23 13:47 CET (GLOBE NEWSWIRE) --
Neo Industrial issues convertible bonds due 2016
Neo Industrial Plc ("Neo Industrial" or the "Company") has decided to issue senior unsecured convertible bonds due 2016 (the "Bonds"), which entitle to a cash compensation based on the value of the underlying shares. The Bonds are proposed to be issued at a principal amount of EUR 6 million and are offered to institutional investors. The nominal value of each bond is EUR 50,000. The Bonds are intended to diversify the Company's funding base, extend the debt maturity profile and improve the liquidity position.
The Bonds are expected to carry a coupon of 7.50% per annum payable annually in arrear starting on 30 November 2012. The Bonds do not entitle to shares but to cash compensation based the Company's class B share price unless previously redeemed or bought back. The ground for the cash compensation (conversion price) is expected to be set at a premium of 25% to the five-day (17 November through 23 November) volume-weighted average price of Neo Industrial's class B shares on the NASDAQ OMX Helsinki. The Bonds will be issued at 100% of their principal amount and the Bondholders are entitled to cash compensation equal to the market value of the shares notionally underlying the Bonds as detailed in the terms and conditions. The right to convert the Bonds, i.e. the right to cash compensation, commences on 2 December 2013. The subscription date of the Bonds is 23 November and the settlement date is 30 November 2011.
The Company will have the right to redeem the Bonds at their principal amount together with interest accrued to such date after 1 December 2014 provided that the closing price of Neo Industrial's class B share has for a specified period been at least 150 per cent of the conversion price as well as at any time if less than 15 per cent of the principal amount of the Bonds originally issued remains outstanding. The investors have the right to require the Company to redeem the Bonds on 30 January 2015 at their principal amount together with accrued interest.
No application will be made to admit the Bonds to public trading.
Pohjola Corporate Finance Ltd is acting as the Lead Manager for the Issue.
Neo Industrial Plc
Markku E. Rentto
Managing Director
Further information:
Markku E. Rentto, Managing Director, Neo Industrial Plc, tel: +358 207 209 181
Timo Mäkeläinen, Managing Director, Pohjola Corporate Finance Ltd, tel. +358 50 307 8977
Neo Industrial's strategy is to invest mainly in industrial companies with similar synergic benefits. The aim of investments is with active ownership to develop the purchased companies and establish additional value. Returns are sought through both dividend flow and an increase in value. Neo Industrial's class B shares are listed on the NASDAQ OMX Helsinki Stock Exchange.
Neo Industrial's business segments are Cable (Reka Cables, Expokabel, Nestor Cables), Viscose Fibers (Avilon) and Single Family Housing (Finndomo).