Shares of Olam International jumped more than eight% after the commodities trader, which is battling short-seller Muddy Waters, announced an issue of bonds and warrants backed by state investor Temasek Holdings.
Olam is issuing a nominal US$750 million ($915 million) of 6.75% five-year bonds at a price of 95%, raising US$712.5 million.
The deal is to be offered pro rata to Olam shareholders and Temasek Holdings, which has a 16% stake, and said it would buy rights not taken up by other investors.
Olam shares rose as much as 8.6% to $1.71, their highest level since Nov. 22.
“This is a swift and decisive move which will likely relieve debt pressure, but may come at a price of eroding minority shareholders’ confidence in the longer-term,” Maybank Kim Eng said.
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