Vivimed Labs completes buy–back of FCCBs totalling USD 12.5 million

Hyderabad : September 2, 2009: Vivimed Labs Limited, bought back and cancelled Foreign Currency Convertible Bonds (FCCBs) of USD 12.5 mn out of USD 15 mn issued in April 2007, maturing for redemption in April 2012.

Bondholders of balance Bonds of USD 2.5 mn opted for conversion into Equity Shares at Rs. 185 per share. Accordingly 563,918 equity shares have been allotted to the bond holders on 31.08.09.

The option to convert bonds into shares is becoming more viable as the amount of unsecured debt goes down when companies buy back FCCBs at a discount to the face value of the bonds.

FCCB buybacks were made possible by RBI last November when the apex body permitted companies to buyback FCCBs using their Forex reserves or the ECB route, and also out of their Rupee reserves, provided that the amount didn't exceed $50 million and it was given from the company's internal accruals.

Mr. Santosh Varalwar, Managing Director of Vivimed commented, "We had sufficient cash reserves for the buy back and our financials are further strengthened by this move. The Balance bonds are now converted into equity shares. Our long term buyback liabilities stands reduced and net worth of the Company has increased by Rs 10.43 crores directly."

The stock closed the day at Rs.93.95, up by Rs.4.45 or 4.97%. The stock hit an intraday high of Rs.93.95 and low of Rs.87.70.

The total traded quantity was 38276 compared to 2 week average of 17664.

Source : Equity Bulls

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