Mar 2018 Financial News

Trinidad Cement Limited - Notice to Shareholders - Signing of MOU between TCL and CCCL

Mar 21, 2018

Trinidad Cement Limited (TCL) hereby advises that on March 16, 2018 it signed a memorandum of understanding, as amended, modified, supplemented, restated and/or enhanced from time to time (MOU), with its subsidiary Caribbean Cement Company Limited (CCCL) agreeing to the essential terms with respect to mainly, the

• Termination of an operating lease agreement originally dated July 2, 2010, as amended, modified,      supplemented, restated and /or enhanced from time to time (the Lease Agreement), signed by TCL as lessor and CCCL as lessee and the corresponding purchase by CCCL of the assets object of the Lease Agreement for approximately USD 118 million to be paid to TCL (the Asset Acquisition);
   
• Redemption of an agreement number of 52 million preference shares issued by CCCL to TCL in 2010 and 2013, for approximately USD 40.5 million to be paid over nine-year period starting in 2018 and sourced from at least 1/3 (one third) of CCCL’s profits available for distribution from the previous year (the “Redemption”); and
   
• Financing options to fund the Asset Acquisition and the Redemption

The closing of the above transaction is subject to the satisfaction of certain conditions, including approval from TCL and CCCL’s corporate bodies, securing financing options by CCCL, the absence of occurrence or potential occurrence of any material tax and / or accounting effects if the above transactions are executed, among others.

The definitive agreements in relation to the foregoing transactions are expected to be executed by TCL and CCCL within 90 days from the date of signing of the MOU.

This transaction is another important step towards strengthening the overall capital structure of TCL, while also improving our asset management strategy.

Source:
The Trinidad and Tobago Stock Exchange Limited
Wednesday March 21st, 2018