Bondholders in CHAMP-backed Blue Star offered new deal

Bondholders objected to a proposal tabled last month which would see CHAMP receive an 18.5% interest rate - plus preferential settlement terms - on a loan of $15 million. This remainder of the $25 million restructuring package would comprise $10 million in working capital supplied by banks. The bondholders have been asked to transfer roughly two-thirds of their $1 bonds into $0.64 amended capital bonds that pay a rate of 9.1% from July 13. The remaining bonds would be reclassified as non interest-bearing and convert to equity at a later date.

The revised proposal allows bondholders to subscribe to the $15 million in shareholder loan notes offered to CHAMP. The private equity firm would effectively underwrite the full amount, with its contribution falling for every bondholder who accepts the new proposal. Separately, a previous $10 million loan provided by CHAMP would be converted into equity.

CHAMP acquired an 84% stake in Blue Start for NZ$385 million ($287.3 million) in 2006. In March of this year, it was reported to have made an additional capital contribution, although no details were forthcoming.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Australasia
• Restructuring
• CHAMP Private Equity