Russian E-Commerce Platform Ozon to Buy Back Bonds at 35% Discount in Restructuring

Irene García Pérez, Bloomberg News

A worker scans an inventory barcode ready to pick an order in the storage area at the Ozon.ru fulfillment center in Tver, Russia, on Tuesday, July 30, 2019. Russian e-commerce platform Ozon.ru's two largest shareholders extended 10 billion rubles ($154 million) in financing this year, signaling faith in the Amazon-style market's expansion even as the economy slows and Baring Vostok partners fight charges related to a dispute at another investment in the country. , Bloomberg

(Bloomberg) -- Ozon Holdings Plc, the Russian e-commerce platform, is offering to buy back its convertible dollar bonds at a 35% discount as part of a restructuring agreement forced by the halt of the trade of its stock from a US exchange.

The firm’s $750 million of convertible bonds due in 2026 became repayable earlier this year after the trading of its shares on the Nasdaq was suspended after Russia’s invasion of Ukraine. Since then, it’s been negotiating with bondholders a solution, as the company had most of the funds stuck in Russia.

On Friday, Ozon announced an agreement to pay 83% of the face value in rubles to those outside the US who choose the redemption in that currency, or 65% of face value in dollars for US bondholders or those who haven’t chosen the ruble option. The company intends to fund the deal with funds from its Russian subsidiaries and has secured the approval of the Russian government, according to the filing.

The restructuring is conditioned on its being in compliance with sanctions imposed by the European Union, UK, US, as well as with Russian law and regulations. Houlihan Lokey EMEA, LLP is the financial adviser for an ad hoc group of bondholders, while law firm Cleary Gottlieb Steen & Hamilton LLP is advising the company. A vote will take place in late October to amend the terms of the notes.

Ozon was one of the three Russian technology firms forced to restructure their convertible bonds after their shares stopped trading in the US and Europe. Search engine Yandex NV agreed with bondholders in June on a buyback of its notes paid in cash and shares. Social media platform VK Co Ltd is still negotiating with bondholders.

(Corrects to clarify in lede the shares were not delisted but the trading was halted.)