BVI-registered agricultural biotechnology company Origin Agritech Limited announced on July 28 that it had entered into a Notes repurchase agreement with Citadel Equity Fund Ltd. The agreement provides for company repurchase from Citadel of a part of its outstanding 1% Guaranteed Senior Secured Convertible Notes by 2012.
The Notes were issued by the BVI company to Citadel in the amount of US$40 mln. Pursuant to the terms of the agreement, the BVI company will repurchase from Citadel the Notes in an aggregate principal amount of US$18.7 mln, for a total repurchase price of US$20.0 mln payable in cash.
The Note repurchase will be completed in two tranches – $14.0 mln of the Notes purchased on July 28, 2008, and $4.7 mln the BVI company expects to purchase by the end of 2008. Upon the completion of the repurchases the repurchased Notes will be cancelled. The Company intends to finance the repurchase of the Notes from its cash resources, and expects the repurchase to be accretive to net earnings by approximately $0.01 per diluted share in fiscal 2008, and $0.06 per diluted share in fiscal 2009.
