BP Plans To Raise GBP 400 Mln Of New Debt Financing

(RTTNews) - British oil giant BP Plc (BP.L, BP_UN.TO, BP) said that, through its subsidiary BP Capital Markets p.l.c., it intends to raise 400 million pounds of new debt financing through a structure combining the issue of guaranteed non-dilutive cash-settled convertible bonds with the purchase of cash-settled call options to hedge the economic exposure to the potential exercise of the conversion rights under the Bonds.

Conversion rights in respect of the Bonds will be cash-settled by reference to the share price of ordinary shares in BP.

As conversion rights in respect of the Bonds will be cash-settled, the issue and conversion of the Bonds will not result in the issuance of any new shares of BP or any other group company.

The Bonds will be issued by BP Capital and unconditionally and irrevocably guaranteed by BP and will have a seven-year maturity.

Concurrently with the issuance of the Bonds, an affiliate of BP Capital will purchase cash-settled call options on the Ordinary Shares to hedge the exposure to pay cash amounts under the Bonds upon any exercise of conversion rights.

BP Capital intends to use the net proceeds of the offering of the Bonds for general corporate purposes and for the purchase of the cash-settled call options. BP expects to announce the final terms of the Bonds later today.

It is anticipated that the hedging counterparties to the cash-settled call options or their affiliates will enter into transactions to hedge their respective positions under the call options, including transactions to be conducted during the reference period for the determination of the share reference price.