Premier Oil offers to exchange convertible bonds

Oil company Premier Oil is inviting holders of its guaranteed convertible bonds due 2014 to trade them in for similar bonds due in 2018.

The new bonds will have a conversion price of $7.00 and a coupon (interest rate) of 2.5%. This compares with the existing convertible bonds, which have a conversion price of $6.69 and a coupon of 2.875%.

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The idea behind the exchange is to extend the maturity of the bonds while saving a few bob on the coupon and gaining on the conversion price. Premier had no comment on what the advantages might be to the holders of the existing 2014 bonds.

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