ECONOMYNEXT – Sri Lanka’s Kotagala Plantations Plc says a sinking fund to repay a billion rupee debenture has a shortfall as it had not made payments as required.
The sinking fund to repay a billion rupee bond issued in 2014 "has not been made in the manner stipulated" in a trust deed, the firm said in a stock exchange filing, without disclosing the shortfall.
"The company is currently evaluating multiple options available in respect of bridging this deficit, and intends on making good the shortfall during the course of the next three months," the firm said.
The Trustee of the transaction has been informed of the actions being planned, the firm said.
Kotagala said interest payments have been made on the time it expects to make future interest payments and the capital, when it falls due.
In May, Fitch Ratings downgraded the firm’s debt from ‘B+(lka)’ to ‘CC(lka)’ amid falling tea prices and deteriorating liquidity. An investment in Cambodia may require further debt, Fitch warned.
This year, better tea prices may improve profits and oil palm may help in the long term when they start to bear. (Colombo/Aug17/2017)