Chagala Group Limited Update on Financial Position (7758L)
October 05 2016 - 6:11AM
UK Regulatory
TIDMCGLO
RNS Number : 7758L
Chagala Group Limited
05 October 2016
Chagala Group Limited
5 October 2016
This announcement is not an offer of securities for sale, or an
offer to buy or subscribe for, directly or indirectly, securities
to any person in the United States or any other jurisdiction,
including in or into Canada, Japan, South Africa, Switzerland and
Australia or any other jurisdiction in which such offer or
solicitation is unlawful. This announcement is an advertisement and
not a prospectus (or prospectus equivalent document). Neither this
announcement nor any part of it shall form the basis of or be
relied on in connection with or act as an inducement to enter into
any contract or commitment whatsoever.
Update on Financial Position
Further to the announcement by Chagala Group Limited (the
"Company" or "Chagala") made on 29 September 2016, the Company
makes the following announcement regarding its current financial
position following the lapse and termination of its Placing and
Open Offer of New Ordinary Shares and potential placing of
Additional Placing Shares (the "Capital Raise").
Financing requirements. The Company had intended to use the
proceeds from the Capital Raise toward the redemption of the Kazakh
Tenge denominated bonds (the "KZT Bonds") issued by Caspi Limited
LLP ("Caspi"), a wholly-owned subsidiary of the Company, which
bonds mature on 1 December 2016. As a result of the termination of
the Capital Raise, another source of financing is required to
provide funds for such redemption. As of 30 September 2016, the
amount of outstanding indebtedness under the KZT Bonds was
equivalent to approximately US$6.7 million. Based on the current
cash balances of the Company and its subsidiaries (together, the
"Group") and the Company's cash flow projections, if the Group
meets it budget targets the Group will be US$5.9 million short of
being able to repay the KZT Bonds when they fall due on 1 December
2016. As a result, the Company estimates that the Group requires a
minimum amount of US$5.9 million of new financing prior to 1
December 2016.
Al Hilal Credit Facility Agreement. Caspi has been informed by
Al Hilal Bank ("Al Hilal") that Al Hilal considers that the legal
proceedings to which the Company is a party in the British Virgin
Islands could negatively affect Caspi's ability to fulfill its
obligations under the master Murabaha credit facility agreement
between Caspi and Al Hilal (the "Al Hilal Agreement"). Al Hilal has
indicated that it intends to accelerate payment of the outstanding
loans under the Al Hilal Agreement unless Caspi takes remedial
measures. The Al Hilal Agreement includes as an acceleration event
Caspi being or becoming unable to pay its debts as they fall due,
suspending the making of payments on any of its debts or, by reason
of actual or anticipated financial difficulties, commencing
negotiations with one or more of its creditors with a view to
rescheduling any of its indebtedness. As of 30 September 2016, the
outstanding amount of Caspi's loans under the Al Hilal Agreement
was approximately US$6.5 million, and the maturity date of the
loans is in November 2019. As of 30 June 2016, Caspi's obligations
under the Al Hilal Agreement were secured by a pledge of immovable
properties with a carrying value of US$6.25 million and a guarantee
issued by Chagala International Holding B.V. Caspi is in continuing
discussions with Al Hilal regarding the potential acceleration and
possible remedial actions that may be taken to avoid it.
BVI legal proceedings. The Company continues to be engaged in
legal proceedings in the British Virgin Islands with TIPP
Investments PCC ("TIPP"). On 5 September 2016, the Company and the
individual members of the Board filed an application seeking to
strike out TIPP's claim, to enter summary judgment against TIPP and
to discharge the temporary injunction that was granted on 29 July
2016. A hearing is currently scheduled to take place on this
application on 27 October 2016. Whilst these legal proceedings
and/or the suspension of rights of TIPP and certain other
shareholders are continuing, it may be difficult for the Group to
obtain financing which is needed to redeem the KZT Bonds.
Possible sources of financing. In light of the termination of
the Capital Raise, the Group is currently exploring all possible
sources of financing which may include equity financing, debt
financing or disposals of assets. To date the Group has not
identified any financing option that would provide funds sufficient
to enable the redemption of the KZT Bonds at their maturity. There
can be no assurance that any of the foregoing possible sources of
financing will be available to the Group.
A further announcement will be made in due course.
For more information:
Francisco Parrilla, Chief Executive
Chagala Group Limited + 7 (727) 298 0131
Chagala Group
Chagala is a service company focused on providing long and short
term accommodation solutions to domestic and international oil and
gas companies developing Kazakhstan's largest hydrocarbon
discoveries. With the ownership of hotels, guest houses, serviced
apartments, remote site facilities, restaurants and offices in its
portfolio, Chagala is well positioned to capitalize on the oil and
gas investment being made in Kazakhstan.
Important Notices
This announcement is not an offer of securities for sale in the
United States, and is not for publication or distribution, directly
or indirectly, in or into the United States of America. The
securities referred to herein have not been and will not be
registered under the U.S. Securities Act of 1933, as amended (the
"Securities Act") and may not be offered or sold in the United
States, except pursuant to an applicable exemption from
registration under the Securities Act. No public offering of
securities is being made in the United States.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCFELFBQBFBFBD
(END) Dow Jones Newswires
October 05, 2016 07:11 ET (11:11 GMT)
Chagala (LSE:CGLO)
Historical Stock Chart
From Apr 2024 to May 2024
Chagala (LSE:CGLO)
Historical Stock Chart
From May 2023 to May 2024