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Impala Platinum offers R6.4bn in convertible bonds

Proceeds will be used to refinance existing debt.

JOHANNESBURG – South Africa’s Impala Platinum (Implats) plans to sell about R6.4 billion ($500 million) of unsecured bonds that will be convertible into shares with the proceeds being used to refinance existing debt, the company said on Friday.

The 2022 bonds will include R3.25 billion ($252 million) of rand-denominated convertibles and $250 million of dollar-denominated convertibles, Implats said in a statement announcing the terms of the offer, which it flagged a day earlier.

The platinum producer, with mines in South Africa and Zimbabwe, said on Thursday it would offer up to R2.6 billion rand and $300 million in convertible bonds maturing in 2022.

“Implats intends to use the net proceeds from the 2022 convertible bond offerings to refinance its outstanding $200 million 1% convertible bonds due 2018 and R2.672 billion 5% convertible bonds due 2018,” the company said.

The 2022 rand-denominated convertible bonds will have an annual coupon of 6.375% and the dollar-denominated bonds will pay 3.25%. They can later be converted into Implats shares, or a cash amount equal to the value of the shares.

“The respective initial conversion prices of $3.8907 and R50.0092 were set at a premium of 32.5% above a reference share price of R37.7428,” the company said.

Shares in Implats closed on Thursday in Johannesburg at R37.50. ($1 = R12.9057)

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