ABB launches $900 million bond issue
Swiss-Swedish engineering group ABB has launched a $900 million (SFr1.461 billion) bond issue as part of a major financial restructuring.
ABB said the bonds would be due in 2007, would be convertible into about 85 million ABB shares, and pay interest at between 4.63 to 5.13 per cent.
The troubled company is working to rebuild market confidence after its share price collapsed amid news of a debt mountain.
But a $3 billion credit deal with 20 banks, announced in early April, has helped to reassure investors.
ABB said on Monday that the bond issue would extend the term of the group’s debt and provide further flexibility in its capital structure.
Trading Monday saw ABB’s share price rise by half a per cent to SFr14.04. However, some analysts expressed concern that the bond issue would dilute earnings-per-share for existing ABB shareholders.
The bond issue is to be settled on or around May 16, according to the firm.
swissinfo with agencies
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