Bunge receives majority approval for Viterra bond swap ahead of acquisition

Bunge Global SA announced that its wholly-owned subsidiary, Bunge Limited Finance Corp. (BLFC), has obtained consent from a significant portion of eligible shareholders to exchange Viterra Finance notes. The announcement is part of an exchange offer for notes issued by Viterra Finance BV, which will be replaced by new Bunge notes and a cash consideration. The proposal seeks to reorganize Viterra’s debt structure and facilitate Bunge’s pending acquisition of the company.

Shareholders holding 96,5% of the 2% notes due 2026 and 3,2% notes due 2031, as well as 97,6% of the 4,9% notes due 2027 and 5,25% notes due 2032, approved the proposed changes. These notes will be exchanged for new Bunge securities with an estimated value of up to US$1,95 billion, plus a cash payment.

Bunge and its subsidiary proposed this restructuring as part of the acquisition process for Viterra. The new terms include the removal of certain restrictive covenants and the exclusion of guarantees from the companies Viterra and Viterra B.V. These changes are intended to simplify the financial terms before the closing of the deal, which is expected at the end of the exchange process.

Shareholders who accepted the offer by the September 20, 2024 deadline will be entitled to receive $1 in new Bunge notes for every $1 in Viterra notes exchanged, plus an additional $1,00 cash payment. Shareholders who accept after that date but before October 7, 2024 will not be entitled to the additional payment.

Completion of the exchange process is contingent upon Bunge completing its acquisition of Viterra. If this transaction is not completed by the agreed upon date, the exchange offer will be extended. Bunge has indicated that all Viterra notes exchanged will remain valid during this extension period.

Market experts point out that the exchange could reduce the liquidity of Viterra's old bonds. In addition, the new amendments to the old notes reduce protection for holders who do not participate in the exchange. Bunge, through the official offering document, highlights that the risks related to the changes are detailed for consultation by eligible investors.

For more information, click: "Bunge Announces Exchange Offer for Viterra Securities in Preparation for Acquisition."