Shuaa Capital has reached an agreement with its bondholders to restructure some USD 150 mn in outstanding bonds owed by a special purpose vehicle it owns, according to a disclosure (pdf). The bondholders will now have the option to convert a portion of their debt holding into equity in Shuaa, with the remaining debt to be settled at an unspecified “pre-agreed” markdown by 31 March, 2025, the company said in the disclosure.

Why this matters: The bonds were originally due on 31 March, 2024, after Shuaa extended the maturity date of the bond. The investment bank’s board said last month that it was asking bondholders to allow it to stretch payment terms as part of a wider restructuring that it says is a checkpoint on the road to a “capital injection that will restore business stability and continuity.” The company has seen its net losses deepen more than fivefold over the past year. The company expects to wrap up the restructuring process by June, and is currently negotiating with its senior creditor over the capital injection.

Background: The bonds, approved (pdf) back in October 2020, were priced at a coupon rate of 7.5% and are listed on the London Stock Exchange’s International Securities Market.

There’s going to be new management to oversee the changes: Shuaa “is putting in place a new management team and is working to complete its capital optimization plan imminently,” with plans to issue its audited FY 2023 financial statements following the completion of negotiations with its senior creditor, it said in the disclosure. Last month, the company said it accepted the resignation of its group chief legal and compliance officer, after its head of private markets had also resigned. Earlier in January, CFO Gunshyam Kripa and two separate board members stepped down from their positions.

Tags: