Jaiprakash Associates approves 'cashless exchange' of bonds

Debt-ridden Jaiprakash Associates' finance committee has approved cashless exchange of existing convertible bonds worth USD 150 million due in 2017 with those maturing in 2020-21.
Earlier this month, the RBI had approved the proposal.
In a BSE filing, Jaiprakash Associates said that the finance committee in its meeting held today "has deemed to have opened and closed the cashless exchange of the existing bonds with the bonds..."
In June, Jaiprakash Associates had said that bondholders agreed to exchange outstanding existing foreign currency convertible bonds (FCCBs) worth USD 150 million. The bonds were issued in September 2012 with maturity in 2017 and a coupon rate of 5.75 per cent.

As per the proposal, the bondholders agreed to exchange their current bonds with FCCBs worth USD 38.64 million bearing the same coupon rate with maturity in 2021 and amortising bonds worth USD 81.69 million with coupon rate of 4.76 per cent and maturity in 2020.
According to the regulatory filing, Jaiprakash Associates will issue 1,10,400 'Series A' bonds having principle value of USD 350 each carrying a coupon rate of 5.75 per cent per annum with maturity on September 30, 2021.

It will also issue 1,10,400 'Series B' bonds having principle value of USD 740 each at a coupon rate of 4.76 per cent per annum and maturity date of September 30, 2020.

That apart, the company will pay USD 27.6 million upfront.
"The finance committee has authorised execution of all transaction document and closing of the transaction would take place on restructuring effective date, which is expected to take place on or before November 30, 2017, on which date the allotment of the bonds and issuance of global certificates would be made," the filing said.
Both series of the bonds would be listed on Singapore Stock Exchange Securities Trading Ltd.
Jaiprakash Associates, which is the flagship company of the Jaypee group, is selling its assets to repay debt.
It is a diversified infrastructure company engaged in segments like engineering, construction and real estate development, cement manufacturing, hospitality and sports management.

Jaypee Group firm Jaypee Infratech has been taken over by a National Company Law Tribunal (NCLT)-appointed IRP (Insolvency Resolution Professional) for recovery of bad loans. The group is facing huge protest from home buyers due to significant delays in delivery of projects.