TCL to suspend debt servicing as group restructures
Trinidad Cement Limited (TCL) said Monday that it will cease paying its debts until a new turnaround plan is crafted and agreed to by lenders and investors in the company.
The cement group says a creditor’s committee has been convened and that an independent adviser is being hired as it moves to restructure its debt.
One of the first tasks is the development of a new business plan for the regional operation, whose top and bottom line earnings have fallen in the recession as construction markets softened and cement imports challenged its market share.
The creditor’s committee comprises the cement group’s largest domestic and international lenders, who together account for 75 per cent of TCL’s total debts.
Trinidad Cement is facing cashflow problems, and its short-term debts of TT$808 million have surpassed its current assets of TT$954 million at September 2010.
The company also reported negative cash flows of TT$111 million.
The debt-restructuring became necessary after TCL breached performance criteria on its short-term borrowings and current ratio.
"The exercise is being undertaken to allow the group`s operations to be funded from the lower-income stream resulting from the severe effect of the current economic decline in all the markets," the company said in a stock-market filing Monday.
TCL trades on the Jamaican, Trinidad, Barbados and Eastern Caribbean exchanges.
Published under Cement News
