Equatorial Palm Oil plc Loan of up to $20.0m for Joint Venture Company (5414Z)
20 May 2019 - 7:00PM
UK Regulatory
TIDMPAL
RNS Number : 5414Z
Equatorial Palm Oil plc
20 May 2019
20 May 2019
EQUATORIAL PALM OIL plc
("EPO" or the "Company")
Loan of up to $20.0m for Joint Venture Company
Equatorial Palm Oil plc (AIM: PAL), the AIM listed palm oil
development and production company with operations in Liberia, West
Africa announces today its 50 per cent. owned joint venture
company, Liberian Palm Developments Limited ("LPD"), has entered
into a loan agreement of up to $20.0m ("Loan Agreement") with KLK
Agro Plantations Pte Ltd ("KLK Agro"), a wholly owned subsidiary of
Kuala Lumpur Kepong Berhad ("KLK"), for the operations and funding
for LPD (the "Loan").
The Loan will be used to continue with the next phase of growth
of LPD and the key terms of the Loan are as follows:
-- Amount - up to $20.0m which is unsecured
-- Term - 5 years from the date of the Loan Agreement, being 19 May 2019
-- Interest - 3-months USD LIBOR + 5 per cent per annum
-- Repayment - Loan principal (together with all accrued Interest due) on expiry of the Term
The Loan is in addition to, and on the same terms as, the loans
of US$20.5m, US$30.0m and US$30.0m provided by KLK Agro, announced
on 27 January 2015, 5 September 2016 and 12 October 2017
respectively (the "Existing Loans"), save for the date of maturity
being 19 May 2024. The Existing Loans, which have now been fully
drawn down and remain outstanding, fall due on 25 January 2020 save
for the loan as announced on 12 October 2017 which falls due on 10
October 2022. The Loan can be drawn down by LPD in line with its
operational funding requirements and subject to the consent of KLK
Agro. The Company is in ongoing discussions with KLK regarding the
Existing Loans which mature in January 2020.
Related Party Transaction
KLK (through its wholly owned subsidiary KL-Kepong International
Limited) currently holds ordinary shares in EPO representing
approximately 62.86 per cent. of the issued share capital of the
Company. In addition, KLK Agro also currently holds 50 per cent. of
the issued share capital of LPD. Accordingly, the Loan Agreement is
classified as related party transaction under the AIM Rules for
Companies. Michael Frayne and Geoffrey Brown, being the non-related
directors of EPO for the purposes of this transaction, consider,
having consulted with the Company's nominated adviser, Strand
Hanson Limited, that the terms of the Loan Agreement are fair and
reasonable insofar as the Company's shareholders are concerned.
- END -
For further information, please visit www.epoil.co.uk or
contact:
Equatorial Palm Oil plc +44 (0) 207 268
Geoffrey Brown (Executive Director) 4874
Strand Hanson Limited (Nominated Adviser) +44 (0) 20 7409
James Harris / James Bellman 3494
Mirabaud Securities LLP (Broker) +44 (0) 20 7484
Peter Krens 3510
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014.
Notes to editors:
Equatorial Palm Oil plc is an AIM listed crude palm oil
developer and producer with palm oil estates in Liberia, West
Africa. The Company was founded in 2005 and is focused on becoming
a global, sustainable producer of high quality palm oil to regional
and international markets.
With a significant land position in Liberia through its
operating subsidiary LPD, the Company is geographically well
positioned to serve the international and regional markets and is
committed to making a positive impact on the communities in which
it operates through investment in local schools, health clinics,
housing and infrastructure.
The Company's largest shareholder and 50:50 joint venture
partner in LPD is KLK. KLK is one of the largest palm oil producers
in the world and the Company will greatly benefit from their many
years of expertise in oil palm development.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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