Hungary plans to issue new convertible bonds worth around 800 million euros before Sept. 28 to refinance expiring debt held by pharmaceutical firm Gedeon Richter GDRB.BU, the state asset management company said.
Miklos Kamaras, Chief Executive of state asset management firm MNV Zrt., was cited by news agency MTI late on Monday as saying that if the issuance is completed before the end of September, the government will not need to take out a bridging loan.
The Hungarian government decided in June that it will pay off the Richter bonds -- which were issued in 2004 -- instead of converting them to Richter shares.
The government holds a stake of 25 percent plus one share in Richter. The decision means bondholders will receive cash instead of shares and the full stake will remain in state hands.
Richter shares traded at 38,980 forints, down 0.6 percent at 0808 GMT on Tuesday while the benchmark BUX was down 1 percent.
(Reporting by Krisztina Than; Editing by John Stonestreet)