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Morgan Stanley selected to organize refinancing of Richter exchangeable bonds

The Hungarian State Asset Management Council selected Morgan Stanley as the winner of a tender to organize the refinancing of bonds exchangeable for Richter shares on Wednesday. The government in June authorized the Hungarian State Holding Company MNV to issue new convertible bonds following the expiration of the current bonds.

MNV said it had received 11 valid bids for the organization of the new exchangeable bond issue. The authorization came after the government decided to keep the state's 25%-plus-one-vote stake in Richter and to compensate investors who purchased the exchangeable bonds with cash rather than Richter shares when the bonds expire in September 2009.

Hungary's government issued €639 million in convertible bonds for its 4.66 million Richter shares in September 2004 under the stipulation that it could compensate investors with either cash or company shares when these bonds expire on September 28, 2009. Cash due on expiry of the bonds is 110.62% of nominal value or a total of €706.9 million (HUF 190 billion).

In 2004 the international offering was managed JP Morgan with Hungarian investment company Concorde Értékpapír acting as leading distributor and sales agent. (MTI-Econews)