Welspun Corp Ltd, the flagship company of the $3.5 billion Welspun Group, today said it has completed a buyback of foreign currency convertible bonds (FCCBs) worth $44.1 million out of $150 million debt.
Welspun, the second largest line pipe company in the world, has completed part buyback of the 4.5% FCCBs due in 2014, it said in a statement.
The company has been able to buy these bonds at a net value of $94,000 per bond, reflecting a 7.5% discount on the accreted value of $101,600 per bond, it said.
This buyback was funded by new foreign currency loan with an average maturity of 5 years. After accounting for this repurchase, convertible bonds worth $105.9 million remain outstanding and due for maturity by October, 2014.
Besides reducing the potential equity dilution, bond repurchase further reposes the confidence in the business model and will boost the profitability going forward, the release said.
Welspun Corp is a one-stop service provider offering complete pipe solution with a capability to manufacture line pipes.
With current capacity of 2.2 million tonnes per annum in Dahej and Anjar in Gujarat, Little Rock in the USA and Saudi Arabia, Welspun is a preferred supplier to most of the Fortune 100 oil & gas companies.
