Singapore's Petra Foods says cocoa division sale to affect several notes

By Jennifer Chiou

New York, Dec. 11 - Petra Foods Ltd. announced that its entry into a conditional sale and purchase agreement with Barry Callebaut AG and Barry Callebaut Belgium NV will result in covenant breaches and a potential event of default under the trust deed of the following series of notes:

• $5 million of floating-rate notes due 2013 (ISIN: SG7Q23939499);

• $9 million of floating-rate notes due 2013 (ISIN: SG7Q16939365);

• S$10 million of 4.5% notes due 2013;

• S$52 million of 4.5% notes due 2014;

• S$13 million of 5.15% notes due 2015;

• S$40 million of 4.75% notes due 2016; and

• S$70 million of 5% notes due 2017.

Under the purchase agreement, Petra plans to sell its cocoa ingredients division, its subsidiaries and associated companies.

Petra said it has agreed that its principal subsidiaries will not dispose of all of substantially all of their assets.

The proposed sale will cause an issue with the representation and warranty in Clause 14.7 of the trust deed in addition to the event of default.

Petra's board of directors said that non-compliance with the trust deed will not affect the company's ability to meet payment obligations for the notes.

The company stated in a press release that it will keep noteholders updated on any developments.

British Malayan Trustees Ltd. is the trustee.

Petra Foods manufactures cocoa ingredients used in branded chocolate confectionery products and is based in Singapore.

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