Vivimed Labs completes buyback of FCCBs totalling $12.5 million
02 Sep 2009
Mumbai: Vivimed Labs Limited has announced buying back and cancelling its foreign currency convertible bonds (FCCBs) of $12.5 million out of the $15 million issued in April 2007, maturing for redemption in April 2012.
Bondholders of remaining $2.5-million bonds opted for conversion into equity shares at Rs185 per share.
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 facilitated by RBI last November when it permitted companies to buy back FCCBs using their forex reserves or through the ECB route, and also out of their rupee reserves, provided that the amount did not exceed $50 million, and came from the company's internal accruals.
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.''
Vivimed Labs manufactures of pharmaceuticals and specialty chemicals for the personal care industry, with a brand range of finished dosage forms for domestic and Fortune 100 companies.