Asia-focused AusGroup gets consents to amend S$110 million 7.45% notes

By Susanna Moon

Chicago, Jan. 28 – AusGroup Ltd. said holders approved amendments to its S$110 million of series 001 7.45% notes due 2016 at a meeting held Thursday.

The amendments were passed without modification, and the consent fees will be paid within five business days of the measure passing, according to a notice.

The consent solicitation began on Jan. 6.

The company asked noteholders to approve changes that would

• Waive non-compliance with terms of the trust deed and events of default; and

• Amend a financial covenant to include a cure mechanism in the event the interest coverage ratio falls below 2:1, such that the company will deposit into the interest service reserve account, in the case of the first relevant test period for which the interest coverage ratio falls below 2:1, an amount equal to one and a half times the interest payable on the notes on the next interest payment date and, in the case of any subsequent relevant test period for which the interest coverage ratio is less than 2:1, an amount equal to twice the interest amount payable on the notes on the next interest payment date; and

DBS Bank Ltd. is the solicitation agent.

Background

The company previously said it conducts its operations in two principal business units: engineering services which comprises integrated maintenance, project, and fabrication and manufacturing services, and, beginning in 2015, port and marine services.

The diversification into port and marine services progressed with the completion and commissioning of the Port Melville fuel facility in July 2015, but the commencement of full port operations was delayed due to longer-than-expected environmental and regulatory approval processes, the company said.

The company said on Oct. 16 that it had received an assessment from the Northern Territory Environmental Protection Authority stating that Port Melville did not require an assessment under the Environmental Authority Act.

The company received a referral decision from the Department of the Environment that the Port Melville Supply Base is not a controlled action, and as such, further assessment and approval will not be required under the Environment Protection and Biodiversity Conservation Act before it can proceed. Following this decision, Port Melville began full operations on Nov. 23.

The delay of the port and marine business unit and deferral of spending on manufactured components impacting the company’s Singapore unit may adversely affect the results of its operations.

The company said it is preparing its financial statements for the six months ended Dec. 31, and the results of operations in respect of the relevant test period ended Dec. 31 are not yet available. As a precautionary measure to avoid any potential non-compliance with the trust deed of the notes, the company is proposing to provide for a cure.

AusGroup is the parent company of AusGroup Singapore Pte. Ltd. AusGroup provides manufacturing and construction services to oil and gas and mining sectors in Southeast Asia and Australia. The parent company is based in West Perth, Australia.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.