United Phosphorus grows investor base

Unusual two tranche structure for Indian agro chemical company.

United Phosphorus, one of the world's top five generic agro chemical companies, raised $140 million from a two tranche CB last Friday December 9. The UBS-led deal differs from most Indian CB in that it forsook a hefty conversion premium in favour of a high degree of equity sensitivity.

The deal is split into two tranches, of which tranche A is effectively equity. This $60 million tranche was priced at par and has a zero coupon, zero yield structure, with mandatory conversion on 17 February 2006 at a 4% premium to the stock's close last Thursday Rs217.65 per share. There is also a $10 million greenshoe.

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