Loss making Seplat Petroleum Development says it has successfully concluded a one year extension of its revolving credit facility (“RCF”) until 31 December 2018.
The company reported a loss after tax of $19.1Million for the first quarter of 2017, but its lenders have a positive appraisal of its possibilities.
Africa’s top homegrown E&P Firm says the current three year RCF was due to expire at the end of 2017. The facility now expires on 31 December 2018 and has been successfully amended to amortise the remaining outstanding principal balance of US$150 million in equal instalments over five quarters commencing Q4 2017. Overall, Seplat’s aggregate indebtedness under its Term Loan and RCF has reduced by US$365 million from its peak in Q1 2015 of US$1 billion to the current balance at the end of June 2017 of US$635 million, which is a significant deleveraging of the balance sheet particularly in exceptionally difficult trading conditions over the past 18 months.
The amended facility has been provided by Citibank N.A. London Branch, Citibank Nigeria Limited, The Mauritius Commercial Bank Plc, Natixis, Nedbank Limited London Branch, Nomura International Plc, FirstRand Bank Limited acting through its Rand Merchant Bank Division, Stanbic IBTC Bank Plc, The Standard Bank of South Africa Limited and Standard Chartered Bank.
Roger Brown, Seplat’s Chief Financial Officer, explains that the approval to extend “and strong demand within our core lending group, which saw around 30% over subscription, demonstrates Seplat’s strong underlying business fundamentals and is further testament to the strength of our relationship with our continuing and new lenders”.
The amended facility, and recent resumption of exports via the Forcados terminal, “will enable the business to rebuild cash on its balance sheet as we seek to strengthen our capital structure to ensure a strong platform for future growth”, Brown adds.