M&M's Foreign Currency Convertible Bonds due on 14th April 2011 - last date for conversion brought forward to 29th Oct 2010
Mahindra and Mahindra issued a notice for redemption of Outstanding Foreign Currency Convertible Bonds and last date for conversion is 29th Oct 2010.
- (1888PressRelease) October 09, 2010 - Mumbai - M&M today issued a notice for early redemption of its outstanding FCCBs of US $ 141.20 mio and setting the last date for conversion of FCCBs into shares/ GDRs to 29th Oct 2010 and balance outstanding FCCBs after conversions, if any, will be redeemed on 8th November 2010
The Company had issued FCCBs aggregating US $ 200 Mio on 13th April 2006, each bond having a face value of US $ 100,000. The bonds carried a zero coupon and were to be redeemed with a premium of 28.03% on 14th April 2011, if not converted earlier by bond holders.
The conversion price for the FCCB was at Rs.461.02 per share at a fixed exchange rate of Rs. 44.42 per US $. The Company has the right to call the bond after two years of issue if the share price is greater than 120% of the conversion price for a continuous period of 30 trading days. The company's share price has been trading consistently higher than 120% for last 12 weeks and currently share price of the Company is Rs 725.70 and the US $/INR is 44.30.
The Company has issued a redemption notice to the Bond Holders by exercising this right under the terms and conditions of the issue. The bond holders enjoy a right to convert into shares/ GDRs at all times and it is expected that most of the bond holders would find it economically beneficial to do so.
Out of the total FCCBs issued, the Company had already bought back bonds aggregating US $ 10.50 mio in FY 2009 at a discount. In the last three months FCCBs aggregating US $ 48.30 mio have been converted into shares/ GDRs by the bond holders. As of date the outstanding FCCBs are US $ 141.20 mio
Mr Bharat Doshi, Executive Director and Group CFO said "in the last 12 weeks, the bonds have started converting as they are in the money by a huge margin. It is a good practice to exercise the right to call in order to bring to focus the current economic value of the bond. We trust, given current market price, the bond holders would find it valuable to convert their holding into M&M shares/ GDRs"
About The Mahindra Group
Mahindra embarked on its journey in 1945 by assembling the Willys Jeep in India and is now a US $7.1 billion Indian multinational. It employs over 1,00,000 people across the globe and enjoys a leadership position in utility vehicles, tractors and information technology, with a significant and growing presence in financial services, tourism, infrastructure development, trade and logistics. The Mahindra Group today is an embodiment of global excellence and enjoys a strong corporate brand image.
Mahindra is the only Indian company among the top tractor brands in the world. It is today a full-range player with a presence in almost every segment of the automobile industry, from two-wheelers to CVs, UVs, SUVs and sedan. Mahindra recently acquired a majority stake in REVA Electric Car Co Ltd. (now called Mahindra REVA), strengthening its position in the Electric Vehicles domain.
The Mahindra Group expanded its IT portfolio when Tech Mahindra acquired the leading global business and information technology services company, Satyam Computer Services. The company is now known as Mahindra Satyam.
Mahindra is also one of the few Indian companies to receive an A+ GRI checked rating for its first Sustainability Report for the year 2007-08 and has also received the A+ GRI rating for the year 2008- 09.
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