CELESTIAL NUTRIFOODS LIMITED said it has on 23 May received notification from the holders of its Convertible Bonds, requiring the Company to redeem the Bonds held by them amounting to S$234,800,000. The due date for the redemption payment shall be on June 12, 2009. Based on the funds currently available to the Company outside the PRC and after considering its working capital requirements in the PRC, the Company shall not be in a position to meet its payment obligations to the holders of the Bonds on June 12, 2009, unless new funding in non-PRC currency drawable outside the PRC is in place by the due date. While the Company is not optimistic in its ability to obtain the said new funding by the due date, it shall, nevertheless, continue with its fund raising efforts, which have been in progress since early 2008. In the meantime, the Company will initiate discussions with the Bond holders in exploring various options to address its payment obligations to the Bond holders. As a result of the above, there are considerable uncertainties in its attempts to settle the obligations of its Bonds. Eventual settlement of its Bonds may result in additional borrowings and issuance of new shares or a combination of both which will have an impact on the interests of its existing shareholders.
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