Smiths City note issue to reduce debt

Press, 1 August 1989, Page 37

Smiths City note issue to reduce debt

Smiths City Group, the Christchurchbased retailer which last week announced a $6 million loss for the year ended April 30, will reduce debt by the convertible note issue announced with the annual result. The issue, which has been fully underwritten, was elaborated on yesterday by Mr Peter Leeming, deputy chairman of the company. The issue comprises 16M unsecured

convertible notes issued at 60c each. These are .being issued in the ratio of one-for-five of the ordinary shares held. The notes have a term of five years, and will bear an interest rate of 12 p.c., payable half-yearly. They can be converted into ordinary shares at the ratio of one for one at any interest payment date. At maturity they will be redeemed by the issue of ordinary shares at the

redemption price. The redemption price adjusts the numbers of shares issued to give each holder 60c of shares in Smiths City Group based on the prevailing market price. However, the minimum number of ordinary 20c shares allotted to redeem each note will be one and the maximum three (i.e. shares will not be issued below par).