Trinidad Cement Ltd (TCL) has repaid all its previous lenders, company chairman, Wilfred Espinet, announced alongside Nigel Edwards and new chief executive, Jose Luis Seijo.
Espinet said shareholders were updated at a February meeting on some of the board's plans to reorganise the capital structure of TCL and were, at that time, advised that the board had agreed to a set of restructuring terms with lenders, with two significant preconditions-the removal of the 20 per cent restriction on shareholding and the injection of new equity of at least US$50m. The board also negotiated discounts between five and 20 per cent of the outstanding loans if lenders were repaid within a maximum period of 90 days, with a facility to maximise the discount if the repayment took place within 45 days.
The preconditions to the restructuring have since been achieved and the company was able to finalise the restructure loans with its 2014 lenders on 30 March 2015.
"That, therefore allowed 45 days, until May 14, 2015 to prepay total debts of US$292m in order to fully benefit from the prepayment discounts to lenders," Espinet said.
"TCL has been able to secure the funds to repay those lenders from short term loans in the amount of US$245m, together with cash from its recent Rights Issue and cash generated from operations."
The company has also secured a nine-month loan facility from international banks Citibank and Credit Suisse, at an initial rate of LIBOR plus 6.25 per cent (a current effective interest rate of 6.53 per cent), subject to a quarterly increase of one per cent if it is still in issue.
In the coming weeks, TCL, along with Credit Suisse and Citibank intend to approach local and international markets to secure longer-term financing that will bring the company to the final stage of the reorganisation of the capital structure.
Some of the expected immediate benefits from the refinancing are a debt reduction from prepayment of previous lenders of US$31m, a reduction in financing costs in the form of quarterly interest savings of up to US$1.7m, and a stronger balance sheet.
New CEO named
Meanwhile, the company has named Jose Luis Seijo, who has previously worked with Cemex, as its new chief executive officer, effective 4 May.
With TCL financial restructuring near completion, Seijo's focus will be on value creation for the company and its stakeholders, TCL said in a statement.
Seijo recently said: "The TCL Group has huge potential. My immediate job is to tap into all our resources-essentially to mobilise the skills of our workforce against a backdrop of improved operational efficiencies and prudent investments to ensure a sustainable future."
He holds a BSc in Mechanical Engineering with a Master's in Finance from the University of Bath, UK.