Denver-based Echo Bay Mines (TSE) recently started to convert its Swiss franc 3.87% bonds due 1996 into common shares. The conversion offer will expire Oct. 28.
At the option of the bondholders, each of Echo Bay’s 5,000 Swiss franc (US$3,286) bonds in the 110-million Swiss franc issue can be converted into 340 common shares.
The bonds were issued in October, 1986, with detachable gold warrants entitling the holder to purchase six ounces of gold from Echo Bay at US$560 per oz. until Sept. 30. The company has offered to convert the bonds ex-warrants into common shares.
If all the bonds are converted, about 7.5 million shares will be issued and Echo Bay’s debt will drop by about US$60.4 million. The company also expects to save about US$2.8 million in annual interest payments.
Echo Bay currently has about 99.1 million shares outstanding.
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