UPDATE: SkyePharma to set new terms for bonds ‘shortly’

Source: Healthcare Digital

Date :02/09/2008 10:05:50

The specialist drug delivery company SkyePharma plc is set to announce a renegotiation of its convertible bonds this week, according to a report by Reuters.

Separately, SkyePharma said yesterday, September 1, that a deal would be announced 'shortly'.

The company has a put option for £69 million convertible bonds due at the earliest in May 2009, and another put option for £20 million due in June 2010 at the earliest.

Without renegotiation, exercising these options could bankrupt the company.

The renegotiation of the bonds is expected to provide significant support to the share price which closed five percent higher at 4.2 pence at 08:49 GMT.

“The news, when the renegotiation is announced, should help drive the share price, therefore we're buyers. I still think fundamentally on an operational basis the stock is worth 31 pence per share,” Landsbanki analyst Shawn Manning said last week.