JD Group (JDG) on Tuesday announced the launch of its inaugural offering of convertible bonds due June 2017 in a nominal amount of up to R1.0 billion‚ with an option to increase the issue size.
The bonds are expected to carry a semi-annual coupon of between 7.0 and 7.5% per annum and will be convertible into ordinary shares in JD Group.
The company said it intends to use the net proceeds of the offering to primarily fund the expected growth in its consumer finance business.
The initial conversion price is expected to be set at a premium of 30-35% above the reference price of R43.62‚ being the 5-day volume-weighted average price of JD Group shares up to Monday June 11.
The bonds will be issued at 100% of their nominal amount and‚ unless converted‚ repurchased or redeemed before June 2017‚ will be redeemed at par in June 2017.
JD Group will have the option to call the bonds after four years‚ if the price of JD Group Shares exceeds 130% of the then prevailing conversion price over a specified period.
“The offering is open with immediate effect and will close as soon as is practicable today‚ Tuesday‚ June 12‚” JD Group said in a statement on SENS.
It is expected that settlement of the bonds will take place on or about Wednesday‚ June 20.
Rand Merchant Bank‚ a division of FirstRand Bank and The Standard Bank of South Africa‚ are acting as joint bookrunners. - I-Net Bridge