The leading Bulgarian car batteries producer Monbat to issue up to EUR 30m 7-year convertible bonds. The Board of Directors adopted the decision for the issuance of up to EUR 30 million and selected ELANA Trading to be the broker for the bond issue.
Monbat bond issue terms
The capital raised will be used for the acquisition of plants in Tunisia and Italy as recently announced by management at a meeting with investors discussing Monbat strategic plans over the next 5 years in market share and portfolio expansion as well adding li-ion technology solutions.
The interest rate on the bond is 6-month EURIBOR plus allowance of 300 bps, but not less than 3% annually. The payment of bonds is in three installments at the end of the 5th, 6th and 7th years respectively 20%, 30% and 50% of the nominal value of the issue. In the event of conversion, the principal repayments will be calculated on the basis of the current bond issue’s nominal value at the date of the respective principal payment.
The bond issue has a call option at the end of the fifth year for a price of 101% of the outstanding nominal value. The conversion option is available on the 48th, 66th and 78th months. The amount to be converted will be against shares issued of Monbat at a price equal to 90% of the average weighted price per one share for the six months prior to the date of the conversion.
The minimum conversion amount is 5% of the outstanding bonds at each conversion date if the issue exceeds EUR 20 million. It is set at a minimum of 10% if the bond issue is less than EUR 20 million.
Shares of Monbat fell 0.5% following the announcement. However, Monbat shares register 38.89% on the upside in the last 12 month valued at BGN 11 per share and up to BGN 429 mln. market capitalization.