7th Nov 2013 10:57
LONDON (Alliance News) - Equatorial Palm Oil PLC Thursday said it has a new partner in its Liberian Palm Developments joint venture, with both companies pumping USD4 million of new loans into the business to get it up and running again within two months.
In a complicated arrangement, Kuala Lumpur Kepong Berhad will buy Biopalm Energy Ltd's 50% stake in Liberian Palm and its 20.1% stake in Equatorial Palm Oil for 5 pence a share.
It will then provide a USD2 million loan to Liberian Palm, and Equatorial Palm Oil will transfer USD6 million of the outstanding liabilities it is owed by Liberian Palm to Kuala Lumpur Kepong.
Equatorial Palm Oil will also lend Liberian Palm USD2 million. After that loan, and the transfer of some liabilities to Kuala Lumpur Kepong, Liberian Palm will still own Equatorial Palm Oil USD5.1 million.
Both of the loans will have a five-year term and accrue interest at 8% a year or Libor +4%, whichever is higher.
"This funding will allow our team on the ground in Liberia to recommence normal operations which have been on care and maintenance for the last few months," Equatorial Palm Oil Chairman Michael Frayne said in a statement.
Equatorial Palm Oil shares were up 10% at 5.91 pence Thursday morning, one of the biggest gainers on AIM.
By Steve McGrath; [email protected]; @stevemcgrath1
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