About the Convertible Bond
A convertible bond is a tradable debt that can be converted into a predetermined amount of the company's equity during its life.
Electra issued £100 million of Convertible Bonds (“Bonds”) in December 2010 to diversify the sources and maturity of funding and to provide additional firepower to take advantage of investment opportunities. Each bond was priced at £1,000 and generates 5% interest per annum payable semi-annually in arrears on 29 June and 29 December in accordance with the terms of the Prospectus. The Bonds are redeemable on 29 December 2017.
The Convertible Bond is listed on the London Stock Exchange and can be traded like other listed securities.
Bondholders can convert their bonds into Electra shares at any time during the life of the bond in accordance with the terms of the Prospectus. The conversion price at the time of issue was 2,050p.
The Company has the option to convert all of the Bonds to ordinary shares on or after 29 December 2015 in accordance with the terms of the Prospectus. This option is exercisable providing that on each of at least 20 dealing days in any period of 30 consecutive dealing days the Parity Value shall have exceeded 130% of the principal amount of the Bond. Parity Value is the number of ordinary shares each Bond will convert into multiplied by the volume weighted average price of an ordinary share. A Parity Value of 130% of the principal amount of the Bond equates to a share price of 2,665p at the time of conversion. This option is additionally exercisable if 85% or more of the original principal amount of the Bonds have been redeemed / converted.
As at 30 September 2014, a total of 3,466 Bonds had been converted into 169,064 Ordinary Shares in Electra. The remaining Bonds in issue at 30 September 2014 are equivalent to 4,708,981 ordinary shares based on the conversion terms of the Bonds. To view the latest block listing announcement please click here.
In the unlikely event of Electra winding up, the Bondholders would rank above the ordinary shareholders in terms of being entitled to the capital of Electra.
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