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Sibanye closes US$450M convertible bonds tender

Sibanye Gold Ltd. said Sept. 5 that it concluded a tender to retire some of its US$450 million convertible bonds.

Eligible holders who submitted valid tender instructions and whose convertible bonds are accepted for purchase will receive a cash consideration equal to the final buyback price, set at 75%, on the settlement date expected on Sept. 11.

The company will also pay an amount in cash equal to interest accrued but unpaid on the convertible bonds up to the settlement date. The accrued interest payment is valued at US$1,718.75 per US$200,000 in principal amount of the convertible bonds, or 0.86%.

Sibanye also decided to accept convertible bonds submitted pursuant to valid tender instructions, which specified a purchase price equal or below the final buyback price in an aggregate principal amount of US$66 million.

Valid convertible bonds that specified a purchase price below the final buyback price will be accepted in full without any pro rata scaling. On the other hand, valid convertible bonds that specified a purchase price equal to the final buyback price will be pro-rated.

The total purchase price of the tendered bonds will be around US$50.1 million.

The company on Sept. 4 launched a US$400 million tender offer to buy back bonds to reduce its outstanding debt and reduce annual interest costs by approximately US$26 million.