NagaCorp secures US$80m loan to refinance debt
NagaCorp has secured a loan at 8 per cent interest from the Chen family’s trust.
Cambodia.- NagaCorp’s board has announced through a company filing that on October 17 it entered into a loan agreement with a trust under the control of the Chen family. The loan of up to US$80m at an annual interest rate of 8 per cent has been extended by ChenLipKeong Capital, a private company registered in the Cayman Islands.
The private entity is owned by The Sakai Trust, a family trust formed by Chen Lip Keong, the controlling shareholder and executive director of NagaCorp. Chen currently holds approximately 69.26 per cent of the company’s total issued shares.
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The focal purpose of the loan is refinancing and discharging a portion of outstanding 2024 notes, specifically two categories of 7.95 per cent senior notes with a combined principal value of US$550m set to mature on July 6, 2024. These were issued by NagaCorp in July 2020 and June 2021, respectively. NagaCorp had already repurchased some of these notes last year, leaving approximately US$472.2m outstanding.
In its filing, NagaCorp expressed confidence that, combined with the company’s existing cash resources, the loan would suffice to meet its financial obligations.
Moody’s Investors Service previously downgraded NagaCorp’s corporate family rating to ‘B3’ from ‘B2’ due to concerns about refinancing the US$472m bond set to mature in July 2024. However, analysts suggested that as the “refinancing overhang gets removed,” the company’s stock will regain its momentum, trading based on solid fundamentals.
