(Alliance News) - IOG PLC on Wednesday said it has proposed waiving its EUR100 million senior secured bond to bondholders.
This was after the London-based, UK-focused gas developer and producer said it had agreed in principle with unnamed key bondholders. It hopes the deal will "provide a further period of stability for the company to address balance sheet challenges".
The agreement includes waiving or deferring certain items under the bond terms for the period to September 29 from a previous interest payments due date of either July 31 or September 20.
Subject to the approval of the proposal, IOG said the repayment price of the bonds will be increased to 105% of par value, while the call option and early redemption prices have increased by 5 percentage points.
It has received voting undertakings of support to vote in favour of the proposed resolution from bondholders controlling more than 60% of the voting bonds, IOG said.
"This proposed waiver to the end of September has been agreed in principle with major bondholders. Upon execution, it will enable us to continue our dedicated efforts to address the challenges facing the business and deliver an outcome in the best interests of all stakeholders," said Chief Executive Officer Rupert Newall.
"As ever, further progress will be announced at the appropriate times."
Shares in IOG were up 19% to 2.09 pence each in London on Wednesday at closing.
On Monday, IOG said it was discussing a potential further waiver on interest payments with its bondholders, and risks being put into administration if talks fail.
In late June, it agreed a waiver to postpone the interest payment deadline under an EUR100 million senior secured bond from June 20 to July 31.
Following "extensive discussions with bondholders and their advisors," IOG said it was now "at an advanced stage" of agreeing another waiver, which it expects to sign "as soon as practicable."
IOG said a further waiver would provide an additional period of stability and thereby help the company address its balance sheet "challenges". Without it, the company warned that it may default on payments and potentially be put into administration, although its directors do not believe this is likely.
By Greg Rosenvinge, Alliance News reporter
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