Najran Cement inks debt restructuring deal with BSF

Najran Cement Co. on Monday inked an agreement with Banque Saudi Fransi (BSF) to reschedule its existing loans, the company said in a bourse statement.

The cement producer obtained BSF’s approval to reschedule its remaining SAR 50 million loan, which was secured for expansion of the third production line.

Under the agreement, the remaining sum will be paid in four equal installments worth SAR 12.5 million over one year, with the first one due on March 31, 2018.

The installments were determined in line with the cement producer’s expected cash flows and are guaranteed by a promissory note and the transfer of an insurance policy to the bank.

The basic loan worth SAR 500 million is repaid on a quarterly basis over five years until June 30, 2018, Najran added.

Meanwhile, BSF approved rescheduling the existing SAR 150 million loan, which was obtained for the power plant. The facility will be paid in ten equal installments, with the first one due on March 31, 2019 until June 30, 2021.

The installments were determined in line with the cement producer’s expected cash flows and are guaranteed by a promissory note.

The basic loan worth SAR 150 million is paid on a quarterly basis over 18 months starting from Sept. 30, 2018.

Najran Cement said these procedures are aimed to enhance the company’s financial position and liquidity in the short and medium term.

The financial impact of the debt restructuring deal represents fees equal to 0.50 percent of the total existing loans on the rescheduling date (SAR 1 million), the statement added.