Lufthansa seeks to reduce debt with JetBlue
02-19-2015, 06:39 AM
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Lufthansa seeks to reduce debt with JetBlue
Lufthansa seeks to reduce debt with JetBlue bond exchange offer
Lufthansa seeks to reduce debt with JetBlue bond exchange offer
Wednesday, 18 February 2015 15:13
Posted by Parvez Jabri
BERLIN: Lufthansa is offering a cash incentive to holders of a bond exchangeable into JetBlue shares to encourage them to exchange the notes ahead of the 2017 expiration date, as it seeks to reduce debt.
Lufthansa in 2012 raised 234.4 million euros ($267 million) by issuing the notes with a coupon of 0.75 percent and an initial exchange price of 5.02 euros per JetBlue share.
Holders of the notes who accept the offer before 2000 GMT on March 3 will receive an incentive payment of 2,500 euros per 100,000 euros principal, while those who accept before the end of March 17 will receive 1,750 euros.
"A successful transaction will allow for an early retirement of the notes and a corresponding reduction in Lufthansa Group's balance sheet debt," Lufthansa said in a statement on Wednesday.
A spokesman said the transaction would be neutral for Lufthansa because it is saving on the remaining coupon payments and help maintain its credit rating.
Lufthansa shares were up 0.9 percent at 0933 GMT, slightly outperforming the DAX blue chip index, up 0.7 percent.
JetBlue said the offer would have no impact on its outstanding share count.
Lufthansa seeks to reduce debt with JetBlue bond exchange offer
Wednesday, 18 February 2015 15:13
Posted by Parvez Jabri
BERLIN: Lufthansa is offering a cash incentive to holders of a bond exchangeable into JetBlue shares to encourage them to exchange the notes ahead of the 2017 expiration date, as it seeks to reduce debt.
Lufthansa in 2012 raised 234.4 million euros ($267 million) by issuing the notes with a coupon of 0.75 percent and an initial exchange price of 5.02 euros per JetBlue share.
Holders of the notes who accept the offer before 2000 GMT on March 3 will receive an incentive payment of 2,500 euros per 100,000 euros principal, while those who accept before the end of March 17 will receive 1,750 euros.
"A successful transaction will allow for an early retirement of the notes and a corresponding reduction in Lufthansa Group's balance sheet debt," Lufthansa said in a statement on Wednesday.
A spokesman said the transaction would be neutral for Lufthansa because it is saving on the remaining coupon payments and help maintain its credit rating.
Lufthansa shares were up 0.9 percent at 0933 GMT, slightly outperforming the DAX blue chip index, up 0.7 percent.
JetBlue said the offer would have no impact on its outstanding share count.
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