Maple Leaf to issue shares to raise funds, Pakistan

Maple Leaf to issue shares to raise funds, Pakistan
Published: 07 April 2010

The board of directors of Pakistan’s Maple Leaf cement Factory on Monday recommended that 153m ordinary shares be issued to generate funds for restructuring the company’s long-term Sukuk and syndicated loan arrangements, and meet the company’s working capital requirements.

It was proposed during a meeting of the board to further issue 153,846,153 ordinary shares of Rs10 (US$0.12) each at Rs6.5 per share at a discount of 35 per cent other than rights, according to the company’s notice issued to Lahore Stock Exchange.

The decision will be subject to shareholders approval as well as the Security and Exchange Commission of Paksistan.

According to the company, the proposed issue will help the company to restructure its long-term loans, improve liquidity conditions, and reduce leverage risk.

Lenders are believed to be forcing the company amid declining cement prices in the local market and high interest rate, distribution cost and taxes to restructure its long term Sukuk and syndicated loans, which Maple Leaf invested in 6700tpd expansion project.