General Information News Archives 22/12/06 - Electra’s debts, purchased by BCA, transformed into Stock Exchange bonds
| 22/12/06 - Electra’s debts, purchased by BCA, transformed into Stock Exchange bonds |
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 The debts of water and electricity utility Electra acquired by Cape Verdean commercial bank Banco Comercial do Atlântico (BCA) for approximately 40 million euros will be transformed into stock obligations in the Cape Verde Stock Exchange. The operation is the first of its kind in Cape Verde.
Portuguese consortium EDP/AdP, until this year the majority shareholders in Electra, and the BCA signed a contract yesterday for the acquisition of credits. With the signing of the contract, the Portuguese consortium granted BCA its credits in Electra for approximately 40 million euros. These credits will now be transformed into money market futures on the Stock Exchange. Yesterday’s contract is yet another step in the process that began with the signing of a Capital Restructuring Accord in August between the State of Cape Verde and EDP/AdP. The two Portuguese companies liquidates Electra’s loans, thus being owed a total of 71 million euros, which Electra would have had to pay, without interest, over the course of 20 years. The credit is now owned by the BCA. The 40 million euros in question are aimed at refinancing Electra’s debt. This is the largest financing operation ever taken on in Cape Verde, and is expected to bring benefits to Electra’s asset situation. This is because, in spite of its relatively low cash flow, Electra will see its debts restructured and effectively reduced by some 31 million euros. The operation is also advantageous for the State of Cape Verde, which will now have to disburse less than 31 million euros. It is also advantageous for the BCA, which now sees its credit portfolio increase by some 25%. In the long term, the operation is also relevant for the expansion of the money market in Cape Verde. The announcement of the transformation of the debt in bonds will be made at 4:00 pm today. The bonds to be issued will have a guaranteed dividend rate and will not be subject to market fluctuations or Electra’s performance. This is the first time such an operation has been carried out in Cape Verde. In practice, 50% of the bonds will remain with the BCA, while the other 50% will be sold on the Stock Exchange. With this, the BCA will possess more credits, and Electra will see its debt restructured, allowing it a greater margin for investing and restructuring the company itself.
Source A semana |