Welspun Corp, an Indian manufacturer of steel pipes for the transportation of oil and gas, on Wednesday launched a tender offer for its $150 million convertible bond that matures in 2014 and which is currently trading at about 80% to 82% of its principal value.
The offer is structured as a reverse bookbuild, which means that bondholders can submit a bid with the number of bonds they would like to tender and at what price. After reviewing the bids the company will decide on a final price where it will buy and all bonds tendered at or below that price will be bought back. Bondholders whose bids are accepted will all receive the same final price. The company could also decide not to accept any of the bids, if it doesn’t like the price.
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