Subex on Monday said it has successfully completed the FCCB exchange offer with its bond holders.
The telecom fraud software maker got the restructured foreign currency convertible bonds (FCCBs) approved by 97 per cent of the bond holders. FCCBs are a special category of bonds issued in a currency different from the issuing company’s domestic currency and used to expand in overseas markets.
Subex has issued new secured bonds worth $127.7 million that will mature on July 2017 and on maturity can be converted at R. 22.79 a share, at an interest rate of 5.7 per cent. Of this, bonds worth $36.3 million will be mandatorily converted into equity shares at the price of Rs 22.79 a share.
Also, the maturity period of the un-exchanged existing bonds worth $3.40 million now stands extended to March 2017. In June, Subex had said that current FCCBs will be exchanged for a combination of new FCCBs with a maturity period of five years and fresh equity shares. With this, the company hopes will put to rest concerns around the financial stability of the company. In line with this, Subex’s founder and promoter, Mr. Subash Menon stepped down as Chairman to comply with the listing agreements.
However, he will continue to be the Managing Director and CEO. Additionally, Mr. Surjeet Singh and Mr. Karthikeyan Muthuswamy have joined its board as additional Directors, being nominees of the new bond holders.
For the conversion of the new FCCBs, the board adopted this floor price based on the pricing formula that was prescribed by the Ministry of Finance. In May, the RBI had approved the restructuring proposal of Subex’s outstanding FCCBs involving a combination of debt and equity.