Education services provider Educomp Solutions on Wednesday said it has tied up with three financial institutions for $155 million (about R852 crore) to pay off existing overseas borrowings (FCCBs), fund capital expenditure and strengthen its balance sheet.
The company said funds have come from World Bank arm IFC, French development finance entity Proparco, private investment firm Mount Kellett and the company’s own promoters.
Out of the total $155 million, Educomp will utilise about $111 million to pay off its existing FCCBs (foreign currency convertible borrowings), which is $78.5 million (R430 million) towards principal repayment and the balance as redemption premium. Educomp said the remaining $44 million will be used towards capex and strengthening the balance sheet. ?The financial package includes $70 million under external commercial borrowings (ECBs), $30 million from IFC and $40 million from Proparco (Societe De Promotion Et De Participation Pour La Cooperation Economique), under an 8.5-year facility,? the company said in a media release.
It will get $10 million via FCCB from IFC, convertible into equity shares at a 40% premium to the floor price. The package also includes an amount of up to $50 million through preferential allotment of equity shares to IFC, Proparco and Mount Kellett at a price of R149.16 a share, a 10% premium to the floor price.
Educomp will also issue equity shares and warrants on a preferential basis to its promoters for an aggregate amount of up to $55 million at a price of R193.74 a share, a premium of around 44% to the share closing price on June 18, it said.
