MakeMyTrip Limited Announces Repurchase Right Notification for 0.00% Convertible Senior Notes due 2028

Rhea-AI Summary

MakeMyTrip Limited issued a Repurchase Right Notice to holders of its 0.00% Convertible Senior Notes due 2028, allowing them to require the company to repurchase the Notes on February 15, 2024 and February 15, 2026. The repurchase price will be equal to 100% of the principal amount of the Notes to be repurchased, totaling US$230,000,000.00 as of January 12, 2024. The opportunity to exercise the Repurchase Right commences on January 18, 2024, and will terminate on February 13, 2024. This press release is for information only and is not an offer to purchase, a solicitation of an offer to purchase, or a solicitation of an offer to sell the Notes or any other securities of the Company.

Financial Analyst

The announcement by MakeMyTrip regarding the issuance of a Repurchase Right Notice for its 0.00% Convertible Senior Notes due 2028 represents a significant financial maneuver that warrants a detailed examination of its implications on the company's liquidity and capital structure. With an outstanding principal amount of US$230,000,000, the potential repurchase of these notes could result in a substantial cash outflow from the company's reserves. This action could be interpreted as a strategic move to manage the company's debt profile, possibly indicating a preference for equity over debt in its capital structure or a proactive measure in response to market conditions.

It is crucial to analyze the timing of this repurchase right, as it offers insight into the company's financial planning. The repurchase dates, set for 2024 and 2026, provide the note holders with the optionality to exit their investment prior to maturity. This could affect the company's short-term cash management strategies. Furthermore, the decision not to pay interest on these notes aligns with the zero-coupon nature of the instrument, which typically translates to a lower initial cost of borrowing for the issuer but a higher repayment amount at maturity due to the accretion of interest.

Investors and stakeholders should closely monitor the company's cash balance and other liquidity metrics in subsequent financial disclosures to assess the impact of this repurchase on operational flexibility. Additionally, the market's reaction to this announcement may reflect investor sentiment towards the company's financial health and strategic direction.

Market Research Analyst

MakeMyTrip's announcement of the Repurchase Right Notice is a strategic move that could signal confidence in the company's future financial performance. By allowing holders of its convertible notes an opportunity to sell back their debt, the company is potentially reducing future debt obligations, which could be appealing to investors who are focused on the company's ability to manage its debt levels effectively.

The impact of this repurchase on the stock market can be multifaceted. It may be perceived positively as a sign of financial strength and prudent capital management, or negatively if the market interprets it as a need to reduce burdensome debt. The actual market response will depend on broader market conditions, investor perceptions of the company's growth prospects and the availability of more attractive investment opportunities.

An important consideration for market analysts is the potential dilutive effect of the convertible notes if they were to be converted into equity. The repurchase right effectively provides the company with a mechanism to prevent dilution by repurchasing the notes. This could be favorable for existing shareholders, as it prevents the erosion of their ownership percentage. However, it also requires the company to have sufficient liquidity to cover the repurchase, which could be a challenge if a significant number of note holders opt to exercise their right.

Legal Expert

The legal intricacies of the Repurchase Right Notice are rooted in the terms outlined in the Indenture agreement between MakeMyTrip and The Bank of New York Mellon. The adherence to the covenants and conditions of this agreement is paramount for the lawful execution of the repurchase. The company's compliance with SEC rules, as evidenced by the filing of a Tender Offer Statement on Schedule TO, demonstrates due diligence and transparency in its dealings with note holders.

From a legal perspective, it is essential to ensure that all procedures for the tender offer are followed meticulously. The terms set forth in the Repurchase Right Notice, including the deadlines and transmittal procedures, create a binding framework for the transaction between the company and the note holders. Any deviation from these terms could result in legal complications or disputes.

It is also noteworthy that the company has made no recommendation to the holders regarding the exercise of the Repurchase Right. This stance is likely a precautionary measure to avoid any potential allegations of coercion or misrepresentation. The company's neutral position respects the autonomy of the note holders and mitigates legal risk while fulfilling its disclosure obligations.

GURUGRAM, India--(BUSINESS WIRE)-- MakeMyTrip Limited (“MakeMyTrip” or the “Company”) (NASDAQ: MMYT), a leading travel service provider in India, today announced that it had issued a Repurchase Right Notice (the “Repurchase Right Notice”) addressed to holders (each, the “Holder”) of its 0.00% Convertible Senior Notes due 2028 (CUSIP No. 56087F AB0) (the “Notes”). The Notes will mature on February 15, 2028, unless earlier repurchased, redeemed or converted. Pursuant to the terms of the Indenture dated as of February 9, 2021 (the “Indenture”) relating to the Notes by and between the Company and The Bank of New York Mellon, as trustee, it is the right of each Holder to require the Company to repurchase the Notes on February 15, 2024 and February 15, 2026 (which is, respectively, approximately three and five years after the Notes were initially issued) (the “Repurchase Right”). The Company is the issuer of the Notes and is obligated, on the Repurchase Date (as defined in the Indenture) occurring on February 15, 2024, to purchase at par all of the Notes, if properly tendered by the Holders in exercise of their Repurchase Right, subject to the terms and conditions set forth in the Company’s Repurchase Right Notice. The Holder’s Repurchase Right expires at 5:00 p.m., New York City time, on Tuesday, February 13, 2024.

As required by rules of the United States Securities and Exchange Commission (the “SEC”), the Company filed a Tender Offer Statement on Schedule TO. None of the Company, its board of directors or its employees has made or is making any representation or recommendation to any Holder as to whether to exercise or refrain from exercising its Repurchase Right.

The Repurchase Right entitles each Holder of the Notes to require the Company to repurchase, on February 15, 2024, all of such Holder’s Notes or any portion thereof that is an integral multiple of US$1,000 principal amount. The repurchase price for such Notes will be equal to 100% of the principal amount of the Notes to be repurchased, as per the terms and conditions of the Indenture and the Notes. As of the date hereof, no interest is payable on the Notes or is expected by the Company to be payable on the Repurchase Date. As of January 12, 2024 there was US$230,000,000.00 in aggregate principal amount of the Notes outstanding. If all outstanding Notes are surrendered for repurchase through exercise of the Repurchase Right, the aggregate cash purchase price will be US$230,000,000.00.

The opportunity for Holders of the Notes to exercise the Repurchase Right commences at 9:00 a.m., New York City time tomorrow, January 18, 2024, and will terminate at 5:00 p.m., New York City time, on Tuesday, February 13, 2024. In order to exercise the Repurchase Right, a Holder must follow the transmittal procedures described in the Repurchase Right Notice, which is available through the Depository Trust Company and The Bank of New York Mellon and is an exhibit to the filed Schedule TO referred to above. Holders may withdraw any previously tendered Notes pursuant to the terms of the Repurchase Right at any time prior to 5:00 p.m., New York City time, on Tuesday, February 13, 2024, which is the second business day immediately preceding the Repurchase Date, or as otherwise provided by applicable law.

This press release is for information only and is not an offer to purchase, a solicitation of an offer to purchase, or a solicitation of an offer to sell the Notes or any other securities of the Company. The offer to purchase the Notes will be only pursuant to, and the Notes may be tendered only in accordance with, the Repurchase Right Notice dated January 17, 2024 and related documents.

Holders of the Notes should refer to the Indenture and the Repurchase Right Notice for a description of the terms, conditions and repurchase procedures and direct any questions concerning the mechanics of repurchase to the Trustee by contacting CT REORG, The Bank of New York Mellon (Email: CT_Reorg_Unit_Inquiries@bnymellon.com). Holders of Notes may request the Company’s Repurchase Right Notice from the paying agent, at 111 Sanders Creek Pkwy, E. Syracuse, NY 13057, Attention: CT REORG, BNY Mellon, CT_Reorg_Unit_Inquiries@bnymellon.com.

Exhibit (a)(5)(A)

HOLDERS OF NOTES AND OTHER INTERESTED PARTIES ARE URGED TO READ THE COMPANY’S SCHEDULE TO, REPURCHASE RIGHT NOTICE AND OTHER RELEVANT DOCUMENTS FILED WITH THE SEC BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT MAKEMYTRIP LIMITED AND THE REPURCHASE RIGHT.

Materials filed with the SEC will be available electronically without charge at the SEC’s website, http://www.sec.gov. Documents filed with the SEC may also be obtained without charge at the Company’s website, https://investors.makemytrip.com/investors/financials.

About MakeMyTrip Limited

MakeMyTrip Limited is India's leading travel group operating well-recognized travel brands including MakeMyTrip, Goibibo and redBus. Through our primary websites www.makemytrip.com, www.goibibo.com, www.redbus.in, and mobile platforms, travellers can research, plan and book a wide range of travel services and products in India as well as overseas. Our services and products include air ticketing, hotel and alternative accommodations bookings, holiday planning and packaging, rail ticketing, bus ticketing, car hire and ancillary travel requirements such as facilitating access to third-party travel insurance, visa processing and foreign exchange.

We provide our customers with access to all major domestic full-service and low-cost airlines operating in India and all major airlines operating to and from India, a comprehensive set of domestic accommodation properties in India and a wide selection of properties outside of India, Indian Railways and all major Indian bus operators. For more information, visit https://www.makemytrip.com/about-us/company_profile.php.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240117241723/en/

For investor and media inquiries, please contact:

MakeMyTrip Limited

Investor Relations

Tel: 1-800-962-4284 (Toll Free US); 781-575-3120 (Outside of US) Email: vipul.garg@go-mmt.com

Source: MakeMyTrip Limited

FAQ

What is the Repurchase Right Notice issued by MakeMyTrip Limited?

The Repurchase Right Notice allows holders of the 0.00% Convertible Senior Notes due 2028 to require the company to repurchase the Notes on February 15, 2024 and February 15, 2026.

What is the repurchase price for the Notes?

The repurchase price for the Notes will be equal to 100% of the principal amount of the Notes to be repurchased, totaling US$230,000,000.00 as of January 12, 2024.

When is the opportunity to exercise the Repurchase Right?

The opportunity to exercise the Repurchase Right commences on January 18, 2024, and will terminate on February 13, 2024.

Is the press release an offer to purchase or sell the Notes?

The press release is for information only and is not an offer to purchase, a solicitation of an offer to purchase, or a solicitation of an offer to sell the Notes or any other securities of the Company.