FINANCE: Derwent London has called in early £175m of outstanding 2.75% convertible bonds thanks to its rising share price.
The bonds, issued in June 2011, were the first convertible bonds to be issued by a UK REIT. Derwent will redeem the bonds on 30 January, ahead of their original due date of 15 July 2016.
This is because Derwent’s share price has exceeded the conversion price for the bonds by 30% on 20 of the last 30 dealing days. The FTSE 250-listed company’s share price at close of business yesterday was £28.90.
As an alternative to redeeming the bonds, investors will have the option to convert the bonds into stocks.
Derwent finance director Damian Wisniewski said: “Given the strong recent share price, we have decided to exercise our option for early redemption of the convertible bonds 2016. With further improved cash flow and interest cover, this will leave us even better placed to deliver our substantial development programme while retaining the flexibility to take advantage of future opportunities should they become available.”
