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| Wockhardt shares surge on settlement hopes |
| BS Reporter / Mumbai Aug 20, 2010, 01:07 IST |
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Share prices of drug major Wockhardt Ltd rose 19.98 per cent on the Bombay Stock Exchange (BSE) today to close at a 52-week high of Rs 223.95 today, as investors anticipated the company would soon resolve its foreign currency convertible bonds (FCCB) issues with lenders.
Wockhardt’s board had this week approved a preferential issue of up to $400 million of convertible or non-convertible redeemable preference shares and to also issue foreign currency mandatorily convertible bonds (FCMCBs) up to $74.09 million, in exchange of existing FCCBs of the same amount.
A group of investors represented by QVT Financial is pursuing a case in the high court here, demanding winding up of the company for paying its bondholders only 35 per cent of FCCB dues.
Wockhardt had to repay FCCBs worth $110 million due for redemption in October last year.
Of these FCCBs, majority bondholders holding $42 million worth have agreed to subscribe for the FCMCBs and the same offer will be given to the remaining bondholders.
The trustees who have filed a winding-up petition on the instruction of majority bondholders, have agreed to withdraw it, Wockhardt had said in the filling.
This will help the company resurrect its earlier plan of divesting its non-core nutrition business, said industry observers.
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