PPC reports positive progress on restructuring and refinancing projects

0
597
  • Driven by need to implement sustainable capital structure
  • Targeting to complete the project by the end of March 2021
  • The project also aims to raise capital in PPC International

Pursuant to previous cautionary announcements, including one released on 15 January 2021, JSE-listed Pretoria Portland Cement (PPC-SA) Limited, says it continues to make positive progress against key milestones on undertaking a restructuring and financing project, underpinned by the need to implement a sustainable capital structure and improving the investment prospects of the Group.

The South African cement giant, has eight manufacturing facilities and three milling depots in South Africa, Botswana as well as Zimbabwe, where it operates through its wholly-owned subsidiary, PPC Zimbabwe. The company markets cement under Surebuild brand in South Africa, Botcem brand in Botswana, and Unicem brand in Zimbabwe. 

The restructuring and financing project is reportedly a result of the Group’s investment in PPC Barnet, in the Democratic Republic of Congo dating back to 2014 and is targeted to be completed by the end of March 2021.

In South Africa, the Group said that all conditions precedent relating to the renewal of short and long-term facilities with its South African lenders, including the registration of security, have been fulfilled.

The agreed facilities provide adequate headroom for the South African operations’ ongoing requirements.

“In the DRC, substantive negotiations continue with the DRC Lenders to implement a sustainable capital structure for PPC Barnet (DRC) and to remove any recourse to PPC Ltd for the provision of deficiency funding to these operations,” the Group said.

“The negotiations are being conducted under the terms of a formal standstill agreement, which is effective until 31 March 2021.”

PPC-SA says as previously disclosed, subject to the resolution of its DRC exposure, it has committed to an equity capital raise by 31 March 2021 in order to de-gear its South African balance sheet.

“Whilst positive progress is being made on the Project, PPC will be formally engaging with its South African lenders to extend the timing of the capital raise by three months to the end of June 2021, when certainty on the key elements of the restructuring is expected,” said the Group.

Meanwhile, the process to raise capital in PPC International continues, with expressions of interest received from various parties being considered.

“The structured sales process for PPC Lime is ongoing, with a number of nonbinding offers received at the end of January 2021 and short-listed parties progressing to due diligence.

“PPC continues to target deal certainty by the end of March 2021,” the Group added.

Pretoria Portland Cement Company Limited, through its subsidiaries, engages in the production and sale of cement. It sells cement through its distribution network to the building and construction industry, concrete product manufacturers, and retail outlets, such as builders, merchants, hardware stores, and DIY centers. The company exports cement to other African countries and the Indian Ocean islands.

Equity Axis News

LEAVE A REPLY

Please enter your comment!
Please enter your name here