Sime Darby Plantation refinances RM3.9bil loans

KUALA LUMPUR: Sime Darby Plantation Bhd has completed the refinancing of its RM3.9 billion credit facilities on marginally improved terms.

The RM3.9 billion financing facilities secured by the group in December last year consist of foreign currency term loans of US$830 million and a ringgit term loan of RM500 million.

A total of 81 per cent of the facilities were secured via Shariah-compliant instruments, Sime Plantation said in a statement today.

“The refinancing exercise was undertaken to review the group’s loan portfolio and to balance its debt maturity profile to be in line with cash flow expectations, while taking advantage of attractive market rates.”

It added that the exercise involved refinancing of its existing term loans which were due for repayment in June this year, restructuring and replacing some of the existing facilities with better pricing as well as converting some working capital facilities to term loans.

The exercise did not result in any increase in the group’s gearing, it said.

Sime Plantation’s borrowing stood at RM7.9 billion as of September 30 last year.

Group managing director Mohamad Helmy Othman Basha said the refinancing was an integral part of ongoing efforts to manage and optimise its debt profile, as well as alleviate its current liquidity exposures.

“This refinancing exercise has not only resulted in a lower cost of debt for us, but it has also improved the debt maturities and increased the group’s financial flexibility to manage our operations and finances.”

He said Sime Plantation was hopeful of reducing its gross gearing ratio from 49 per cent as at September 30 last year to 30 per cent within the next three years.

Source: NST