Cemex plans convertible bond issue

Cemex plans convertible bond issue
Published: 24 March 2010

Cemex said on Tuesday it plans to sell convertible bonds worth US$500m as part of a wider refinancing effort to extend debt payments.

Cemex said the bonds, which are convertible into shares, would be due in 2015.

"Cemex expects to grant the initial purchasers of the notes a 30-day over-allotment option to purchase up to US$75m additional aggregate principal amount of notes," Cemex said in a statement.

The notes will be convertible into American Depositary Shares, or ADSs, the company said, adding the conversion rate would be determined when the deal is priced.

"The notes will be general unsecured subordinated obligations of Cemex and will be subordinated to all of Cemex’s existing and future senior debt," it added.

Cemex said it would seek to buy back some of the shares from one of the initial purchasers to reduce any costs linked to the conversion of the notes to shares.

Cemex, which became swamped by debt after buying Australian rival Rinker in 2007, has sold more than US$2bn in bonds since December as it seeks to extend debt maturities.