PLC to raise Rs. 6 b via listed debenture

The Rs. 6 billion listed debenture issue of People’s Leasing and Finance Plc (PLC) is now up for subscription. 

The company is issuing 40 million Listed, Rated, Unsecured, Redeemable Debentures of Rs. 100 each with an option to issue a further 20 million debentures in the event of the oversubscription of the original amount. 

The debentures are of tenors of four and five years and carry fixed coupons. 

Type A debentures of four years offer 12.40% interest rate per annum and Type B debentures of five years offer 12.80%. Fitch has assigned AA- rating for PLC’s debentures.

The primary objectives of the Debenture Issue are to repay the short-term facilities obtained to settle the debentures matured on 26 March 2018 and for the company’s working capital requirements. Company intends to utilise the mobilised funds of this Debenture Issue in the following proportions: To repay the short-term facilities obtained to repay the 2013 Debenture Issue - 70% and for working capital requirement - 30%.

Since the opening date of the Debenture Issue fell beyond the date of 26 March 2018 (maturity date of the 2013 Debenture Issue), the company utilised the following short-term facilities to retire the Debentures Matured on the 26 March 2018 till the proceeds of this Debenture Issue are available for the company to utilise the objective. HNB (Rs. 2 billion), Sampath Bank (Rs. 2 billion) and People’s Bank (Rs. 200 million).

The managers to the issue is the People’s Bank Investment Banking Unit. The official opening of the issue is 11 April whilst it was available for subscription from 6 April.