FCCB ISSUERS CAN NOW REVISE CONVERSION PRICE

The finance ministry has amended rules for foreign currency convertible bonds (FCCB) to allow issuers to revise their conversion price, a move aimed at reducing price uncertainty in a volatile equity market. The change will give issuers a window of 6 months to adjust the conversion price of their bonds to the higher of either the two weeks average or the six months average of the issuing company's stock. The decision applies to companies that issued FCCBs before November 27, 2008. In November 2008, the ministry had changed the FCCB pricing rules bringing the issue price of the securities offered closer to their market price.