Pacific Radiance completes refinancing planCompany News // October 26, 2016
Pacific Radiance Ltd has negotiated a series of agreements with its main bankers/financial partners to refinance its existing term loans and renew revolving credit facilities totalling approximately US$185 million due in the near to medium term.
With the support of the group’s key lenders, the profile of the term loans has been refinanced to 12 years from an average of seven years, and the maturity have largely been extended from 2019 to 2021.
As a result, the group’s loan principal repayment burden will reduce by approximately US$103 million over the next three years to 2019.This is expected to enhance the Group’s liquidity position and financing cash flows in the near to medium term.
Mr Pang Yoke Min, Executive Chairman of Pacific Radiance, said: “The new arrangements represent a clear vote of confidence from our key financial partners – not just in our financial standing but also in our strategic plans for the future. The timely extension of our long-term financial arrangements has secured us a stronger footing to weather this gruelling industry downturn as we await the sector recovery.”
Pacific Radiance has worked to proactively strengthen its financials and enhance cashflows since the onset of the industry downturn in late 2014, in line with its risk mitigation strategy. This includes the successful amendment of a financial covenant in November 2015 under the Group's only bond issue due in August 2018 to avoid any technical breaches.
In addition, Pacific Radiance has not committed to any new capital expenditure for its fleet expansion programme since mid-2014 – the last of the newbuild vessel deliveries that it committed to previously is expected to be made by early 2017.
The group also recently entered into a settlement agreement to receive the full refund of US$10.6 million in pre-delivery instalments for the construction of two platform supply vessels.