ECONOMYNEXT – John Keells Holdings (JKH), considered one of Sri Lanka’s high conglomerates will borrow 75 million US {dollars} (27.1 billion rupees) from a Canadian monetary establishment by means of privately positioned debentures to fund greenback primarily based investments resembling West Container Terminal in Colombo, the agency mentioned in a disclosure to the inventory market.
Canada-based Fairfax Monetary Holdings Restricted will lend the required greenback amid the crisis-hit and sovereign debt defaulted financial system is desperately searching for {dollars} to fund its necessities together with gas and cooking fuel.
John Keells will problem 208.2 million debentures, every at 130 rupees to Fairfax Monetary Holdings Restricted.
The convertible debentures will accrue curiosity at a fee of three% each year.
“The proceeds from the problem will probably be used to assist the Firm’s funding and financing obligations, notably by way of managing the international forex linked funding necessities in investments such the West Container Terminal (WCT) within the Port of Colombo,” JKH mentioned in a inventory submitting on June 21.
JKH will make investments 70 million US {dollars} in 3.2 million twenty-foot equal container terminal within the WCT three way partnership within the Colombo Port, taking a 34% stake with the bulk is being held by India’s Adani group.
The 650 million US greenback Colombo West Worldwide Container Terminal (Pvt) Ltd, will probably be 70/30 debt to fairness funded.
India’s Adani will maintain a 51 per cent stake and Sri Lanka Ports Authority the owner will maintain a 15 per cent stake.
The conversion of the debentures to newly listed extraordinary shares will happen inside 18-36 months from the date of problem of the instrument by the corporate to the investor.
JKH mentioned the funding will strengthen its monetary place amid a worsening greenback disaster worsens and better rates of interest.
“The Proposed Non-public Placement will allow the Group to assist this funding pipeline and match its international forex linked venture prices while lowering the necessity to fund a few of its necessities by means of the native banking sector given the stresses on capital and rates of interest.”
The debenture will mature in 3 years. (Colombo/June 21/2022)
