San Miguel surprises with exchangeable terms

19 Apr 2011

Philippines conglomerate San Miguel expects to raise $850m from a simultaneous exchangeable bond and share sale on Tuesday after closing the books on the long-awaited deal overnight. But the deal split had still not been finalised on Monday evening — and bankers expressed concerns about a rare option to reset the exchange price of the bond ever quarter.

San Miguel’s EB can be swapped for shares in Top Frontier, a related company. But San Miguel will encourage investors to exchange by resetting the exchange price at the end of every quarter if its stock stays below the exchange price over the previous month. The reset exchange ...

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