Insurance company Ageas has received full support from the Commercial Court of Brussels in summary proceedings against certain hedge fund owners of mandatory convertible securities.
The latter requested that a meeting of MCS holders be convened in order to approve a resolution to extend the maturity of the MCS by 20 years.
ageas SA/NV and ageas N.V., in coordination with the two other issuers of the MCS (ABN Amro and BNP Paribas Fortis), initiated summary proceedings to prevent the MCS holders from holding such a meeting.
The president of the Commercial Court of Brussels, acting in summary proceedings ordered that, although a MCS holders’ meeting could take place before 7 December 2010, its effects would be suspended. The bondholders’ meeting scheduled for 8 November will take place but will have no practical effect.
The president of the Commercial Court of Brussels also ruled that all parties should refrain, under penalty, from any action that could jeopardise the conversion of the MCS into Ageas shares on 7 December 2010.
The president of the Court also recognised explicitly, even if provisionally, that bondholders do not have the right to unilaterally modify the terms and conditions of a debt instrument.
The MCS will therefore be mandatorily converted into Ageas shares on 7 December 2010 in accordance with the original agreement.