BNDES to Acquire Marfrig Bonds

Brazil food company Marfrig has confirmed that development bank BNDES will acquire up to 100% of the BRL2.5bn in 5-year convertible debentures it will issue to fund its acquisition of US-based Keystone Foods. The bonds are mandatorily convertible into equity after 5 years and would pay interest at the DI rate plus 1%, Marfrig says. The conversion price will be BRL21.50 adjusted by CDI+1%, as well as for dividends and other payments. If the adjusted price is greater than market, the conversion price reverts to market, with a floor of BRL24.50.