Bond overview
This section offers some important information for debt investors.
The ability to flexibly use different sources of funds plays a key role in the financing of the Lonza Group. Lonza has therefore established a number of debt programs. |
The net debt comprises:
|
million CHF
|
|
2007
|
|
2008
|
|---|
|
Long-term debt
|
|
|
|
| |
Bonds
|
|
298
|
|
299
| |
Convertible bonds
|
|
423
|
|
0
| |
Syndicated loan
|
|
497
|
|
498
| |
Due to banks and others:
|
|
|
|
| |
. Banks
|
9
|
|
13
|
| |
. Others
|
119
|
128
|
74
|
87
| |
Leasing
|
|
14
|
|
10
| |
Total
|
|
1 360
|
|
897
|
Convertible bond (2005-2009)
Amount: CHF 430 million, due 15 July 2009. Interest: 1.5 % p.a. payable on 15 July, for the first time on 15 July 2006. Conversion right: On or after 25 August 2005 up to and including 1 July 2009, each bond of CHF 5 000 principal amount is convertible by bondholders into 54.52563 shares with a par value of CHF 1 (conversion price: CHF 91.70; section 2 of the terms of the bond).
The fair value of the liability component and the equity conversion component was determined on the issue of the convertible bond in 2005. The fair value of the liability component, included in long-term debt, was calculated using a market interest rate for an equivalent non-convertible bond. The residual amount, representing the value of the equity conversion component, is included in equity.
The convertible bond is recognized in the balance sheet at initial recognition as follows:
|
|
million CHF
|
Convertible Bond (2005-2009)
|
|---|
|
Face value of convertible bonds
|
430
| |
Equity conversion component
|
(14)
| |
Liability component on initial recognition
|
416
| |
Interest expenses
|
6.5
| |
Amortization of liability component
|
3.5
|
| In 2008, the convertible bond was transferred from long-term to short-term debt, as it will expire on 15 July 2009. The following conversions were made during 2008: |
|
1 000 CHF
|
|
|---|
|
|
| |
1 August 2008
|
2 805
| |
1 October 2008
|
11 985
| |
14 October 2008
|
21 695
|
The nominal value of the convertible bond (2005 - 2009) at 31 December 2008 amounts to CHF 394 million.
Following please find the prospectus for the convertible bond. |
Straight bond (2005-2010)
Amount: CHF 300 million, due 2 June 2010. Interest: 2.625 % p.a. payable on 2 June, for the first time on 2 June 2006. The annual interest expenses amount to CHF 7.9 million.
Following please find the prospectus for the straight bond. |
Syndicated loan
In order to finance the acquisition of the Biopharma and Bioproducts businesses from Cambrex, Lonza signed a syndicated loan of CHF 500 million with a consortium of banks in December 2006; the contract term is five years. It is based on floating rates (libor + margin depending on a margin grid) and was drawn down in February 2007. Lonza hedged the interest rate for the whole five years via an interest rate swap. |
Short-term debt (floating interest rates)
|
million CHF
|
2007
|
|
2008
|
|---|
|
|
|
|
| |
Due to banks and other financial institutions
|
194
|
|
585
| |
Others
|
159
|
|
176
| |
Long-term debt due within one year
|
|
|
|
- Convertible (2005 - 2009)
|
0
|
|
391
| |
Total
|
353
|
|
1 152
| |
Total debt
|
1 713
|
|
2 046
|
Loans and advances (floating interest rates)
|
million CHF
|
2007
|
|
2008
|
|---|
|
Long-term loans and advances
|
(28)
|
|
(9)
| |
Short-term loans and advances
|
(4)
|
|
(2)
| |
Cash and cash equivalents
|
(372)
|
|
(566)
| |
Total
|
(404)
|
|
(577)
| |
Net debt
|
1 309
|
|
1 469
|
| Loans and advances decreased in 2008 compared with the prior year, mainly due to repayment of the vendor loan to Perstorp of CHF 17 million. |
Breakdown of debt by currencies
|
million CHF
|
|
|
2007
|
|
|
2008
|
|---|
|
|
Average
|
|
|
Average
|
|
| |
|
interest
|
|
|
interest
|
|
| |
|
rates
|
|
|
rates
|
|
| |
|
%
|
%
|
|
%
|
%
|
| |
|
|
|
|
|
|
| |
Swiss franc
|
2.51
|
78
|
1 330
|
2.63
|
83
|
1 706
| |
Euro
|
4.30
|
0
|
1
|
4.60
|
0
|
1
| |
US dollar
|
5.75
|
20
|
345
|
3.30
|
12
|
249
| |
Other
|
2.52
|
2
|
37
|
3.75
|
15
|
90
| |
Total
|
|
100
|
1 713
|
|
100
|
2 046
|
Breakdown of loans and advances by currencies
|
million CHF
|
|
|
2007
|
|
|
2008
|
|---|
|
|
Average
|
|
|
Average
|
|
| |
|
interest
|
|
|
interest
|
|
| |
|
rates
|
|
|
rates
|
|
| |
|
%
|
%
|
|
%
|
%
|
| |
|
|
|
|
|
|
| |
CZK
|
0.00
|
0
|
0
|
8.00
|
18
|
2
| |
Euro
|
4.00
|
12
|
4
|
0
|
0
|
0
| |
US dollar
|
6.00
|
88
|
28
|
3.00
|
82
|
9
| |
Total
|
|
100
|
32
|
|
100
|
11
|
| Interest rates are floating rates. |
Other short-term liabilities
|
million CHF
|
2007
|
2008
|
|---|
|
|
|
| |
Short-Term Provisions
|
33
|
21
| |
Short-term retirement benefit liability
|
6
|
0
| |
Accrued liabilities and other payables
|
300
|
368
| |
Other interest-free liabilities
|
299
|
238
| |
Accrued interest payables
|
17
|
11
| |
Total
|
655
|
638
|
"Accrued liabilities and other payables" include accruals and deferred income, such as down-payments from customers and the fair values of financial instruments. In other interest-free liabilities, payments received from customer funding are included.
|
Straight bond (2009-2013)
|
 |
Amount: CHF 300 million, due 27 May 2013. Interest: 3.75% p.a.
Following please find the prospectus for the straight bond. |
|
|
