Tower Semiconductor Ltd. (Nasdaq: TSEM; TASE: TSEM) (which trades as TowerJazz), headed by Russell Ellwanger, announced today that it had received binding commitments from institutional investors to invest approximately $100 million in its long-term non-convertible unsecured straight bonds ('Series G Bonds”), which will have final maturity date of March 2023. The Series G Bonds are payable in seven semi-annual principal installments from 2020 to 2023, carry an annual coupon of 2.79%, are denominated in shekels and are not linked to any index or to any other currency.
Orders received for the institutional tender totaled $263 million, 163% above the amount being asked.
Both the Series G Bonds and the Company have received an “A” rating from Standard & Poor’s Ma’alot Ltd.
The company said that proceeds from this fundraising will be used for early repayment of debt and to replace its outstanding $78 million Israeli bank loans in order to further strengthen its balance sheet and provide better financial and business flexibility, including through the removal of the extensive restrictions and covenants under the Israel bank loan agreement, as well as the release of all the fixed and floating liens that were charged in favor of these banks.
In the tender, institutional investors committed to purchase approximately 400,000 units, each of which is valued at NIS 1,000 of principal amount of the long-term non-convertible Series G bonds.
The Israeli public tender for Series G Bonds, which will complete the offering, is expected to be held on or about June 1, 2016, subject to Tel Aviv Stock Exchange approval. The company has further announced that it will limit the acceptance of offers under the public tender to approximately $14 million, such that the total aggregate proceeds of this offering will not exceed $114 million.
The offering was only for residents of Israel. the vbond issue was led by Leader Underwriters.
Published by Globes [online], Israel business news - www.globes-online.com - on May 31, 2016
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