PME African Infrastructure Opps PLC Amendment to Loan Agreement (0606V)
29 November 2019 - 6:00PM
UK Regulatory
TIDMPMEA
RNS Number : 0606V
PME African Infrastructure Opps PLC
29 November 2019
29 November 2019
PME African Infrastructure Opportunities plc
("PME" or the "Company" and together with its subsidiaries the
"Group")
(AIM: PMEA.L)
Amendment to Loan Agreement
The Company announced on 7 May 2019 that it had entered into a
secured loan agreement with Optas GmbH (the "Lender") pursuant to
which the Lender agreed to make up to EUR400,000 available to the
Company (the "Initial Loan"). The purpose of the Initial Loan was
to provide the Company with general working capital funding while
it was progressing the registration of an existing Group
intercompany loan with the Bank of Tanzania. As at 28 November
2019, the Company had drawn down EUR358,000 of the Initial
Loan.
PME announces that it has now entered into an amendment
agreement with the Lender, pursuant to which the Lender has agreed
to increase the amount of Initial Loan from EUR0.4 million to
EUR0.6 million as well as extending the date of the repayment of
the increased loan facility to 28 May 2021 (the "Loan
Increase").
As required by local regulation, the Group has been working with
its local bank to have an existing intercompany loan between PME
Properties Limited and PME TZ Property (Mauritius) Limited, both
wholly owned subsidiaries of the Company, registered with the Bank
of Tanzania. Whilst the Company expects this process to conclude
satisfactorily, the registration process has proven time consuming
due to slow progress within a number of departments within the Bank
of Tanzania.
The Company has been advised that, prior to the registration of
the existing Group intercompany loan being completed, the Group is
not able to transfer funds from its Tanzanian subsidiary to the
rest of the Group and outside of Tanzania. The Company's sole
remaining investment, a leasehold building in Dar-es-Salaam,
Tanzania, continues to trade profitably and to generate sufficient
cash which would be capable of meeting the Group's working capital
requirements. However, as a result of not being able to transfer
cash held by the Company's Tanzanian subsidiary to the rest of the
Group, the Company had unaudited cash balances of approximately
US$27,000 and undrawn additional funds available under the Initial
Loan of EUR42,000 as at 28 November 2019. The Group had
approximately US$437,000 of cash held by its Tanzanian subsidiary
as at 28 November 2019, which is expected to become available to
the Company once the registration process with the Bank of Tanzania
is completed.
The Company has entered into the Loan Increase with the Lender
in order to mitigate the potential risk of insufficient working
capital being available to the Company in the event that the
registration process with the Bank of Tanzania is further delayed
and thereby affecting the Group's ability to transfer funds held in
its Tanzanian subsidiary to the Company.
The principal changes to the Initial Loan effected by the Loan
Increase are the increase in the amount of the loan facility from
EUR0.4 million to EUR0.6 million and the extension of the repayment
date for the increased loan facility to 28 May 2021. All other
terms of the Initial Loan remain unchanged. There are no
arrangement fees payable by the Group to the Lender in connection
with the Loan Increase. The Company currently expects that it will
typically draw down the additional funds made available pursuant to
the Loan Increase at a rate of approximately EUR25,000 to EUR55,000
per calendar month.
Related Party Transaction
Paul Macdonald, a director of the Company, is interested in 50%
of the Lender's issued share capital. Under the AIM Rules for
Companies (the "AIM Rules"), the Lender is, therefore, deemed to be
a related party of the Company and the Loan Increase is a related
party transaction pursuant to Rule 13 of the AIM Rules. The
independent director of PME, Lawrence Kearns, considers, having
consulted with the Company's nominated adviser, that the terms of
the Loan Increase are fair and reasonable insofar as the
shareholders of PME are concerned.
For further information please contact:
Cenkos Securities plc
Nominated Adviser
Azhic Basirov / Ben Jeynes +44 20 7397 8900
Stifel Nicolaus Europe Limited
Broker
Neil Winward / Tom Yeadon +44 20 7710 7600
The information communicated within this announcement was deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014 prior to the release of this
announcement. Upon the publication of this announcement, this
inside information is now considered to be in the public
domain.
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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