SINGAPORE, July 1 (Reuters) - Singapore-listed AusGroup AUSG.SI said on Friday it has proposed an extension of up to two years to holders of S$110 million ($81.8 million) worth of October 2016 bonds after poor financial results.
AusGroup, which provides services from construction to engineering and also operates in the troubled marine industry, breached a financial covenant when its consolidated total equity dipped below the minimum of A$160 million ($120 million) required in the bond agreement, triggering a default.
Under the terms, holders can immediately call for the bonds to be redeemed with accrued interest.
The Australian company has proposed two interest increases, one in October 2017 to 7.95 percent, and another in October 2018 to 8.45 percent. The current coupon is 7.45 percent.
In a notice issued on the Singapore Exchange, advisor KPMG highlighted that any acceleration of the bond could mean bondholders may not recover their investment in full.
AusGroup holds a total group debt of roughly S$179 million ($133 million). A meeting with bondholders of the S$110 million bond is set for July 18.
So far, AusGroup has received approval from DBS Bank to extend its repayment deadline of a A$11 million loan due August 31 and a A$14 million loan due April 2018 to 2019 onwards. Ezion Holdings has also approved the extension of a A$37.2 million related party loan to 2019 onwards. (1 Singapore dollar = $0.7435) ($1 = 1.3380 Australian dollars)