17 Jul 2008 15:31
Afren plc (AIM: AFR)
Notice to Convertible Bond Holders
London, 17 July 2008 - Afren plc ("Afren" or the "Company") is today sending a notice to holders relating to the 9% 2011 Convertible Bonds (the "Bonds").
The notice contains details of an offer, available for a limited period, to pay a conversion premium to all holders of the Bonds who exercise their right to convert their holdings into ordinary shares during such period (the "Offer").
The Bonds, which have a face value of £41.25 million, were initially issued in July 2006 via a private placement to institutional investors and are listed on the Channel Islands Stock Exchange. The Bonds are currently scheduled to redeem in 2011 and are convertible into approximately 71.1 million ordinary shares of the Company. Under the terms of the Offer, holders of the Bonds that submit conversion notices by 24 July 2007 will receive a cash payment equal to 11.5% of bond face value.
The Bonds are no longer considered to be a financially efficient instrument for Afren and conversion of the Bonds into new ordinary shares will extinguish the balance sheet liability and release the Company from the covenants contained within the terms and conditions of the Bonds. The overall effect will be to improve the Company's flexibility and capacity in relation to any potential future debt capital raising opportunities.
In the event of a full take up of the Offer, 71,120,689 new ordinary shares will be issued to holders of the Bonds and the Company will achieve a reduction in net borrowings of £41.25 million. Admission of the new ordinary shares to trading on AIM is expected to take place during the week beginning 28 July 2008.
A copy of the notice is available upon request from the Company. Jefferies International Limited is acting as Dealer Manager to the Conversion Premium Offer.
Enquiries:
| Afren plc | +44 20 7451 9700 | |
| Osman Shahenshah | Chief Executive | |
| Galib Virani | Investor Relations | |
| Jefferies International Limited | +44 20 7029 8000 | |
| Rupert Mitchell | ||
| Jack Pryde | ||
| Oliver Griffiths | ||
| Pelham Public Relations | +44 20 7743 6676 | |
| James Henderson | ||
| Alisdair Haythornthwaite |
Not for transmission to any U.S. person or to any person or address in the United States or in any other jurisdiction in which the offer would be prohibited by applicable law. This announcement is for information purposes only and does not constitute, nor form part of, an offer to sell or issue or a solicitation of an offer to buy securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Jefferies International Limited, which is authorised and regulated by the Financial Services Authority in the United Kingdom, is acting as financial adviser to Afren plc and no one else in connection with the subject matter of this announcement and will not be responsible to anyone other than Afren plc for providing the protections afforded to the clients of Jefferies International Limited nor for providing advice in relation to the subject matter of this announcement.