21st Apr 2016 16:27
LONDON (Alliance News) - MirLand Development Corp PLC on Thursday said it has received the final installment of the USD6.0 million commitment from its majority shareholders, which was agreed as part of its restructuring plan.
MirLand, the Russian residential and commercial property developer, is in the process of agreeing a set of proposals with bondholders that would see around USD180.0 million of debt converted into equity. This would leave USD45.0 million of outstanding bonds remaining, which will continue to be unsecured, the company said.
Repayment of these bonds will begin in 2021, in the form of three equal annual installments, and will bear an annual interest of 1.0%, which will start to be paid in December 2017.
Under the proposals, the three controlling shareholders of the company, being Jerusalem Economic Ltd, Industrial Building Corp Ltd and Darban Investments Ltd, will be asked to commit to providing funding of USD25.0 million in total, including USD4.0 million previously provided, in return for an equity stake of about 40% of the company. The bondholders will hold the remaining 60%.
The shareholders were asked to make a GBP6.0 million commitment, to represent an advance on the USD25.0 million funding, and, on Thursday, MirLand said it had received the last GBP2.0 million of the USD6.0 million.
MirLand said it will use this as additional working capital. This advance is unsecured and does not bear any interest, MirLand said.
The USD2.0 million represents a related party transaction, MirLand said and, as such the company's directors, excluding Non-Executive Director Eliezer Fishman and Non-Executive Director Eyal Fishman, given their interests in the three majority shareholders, have consulted with MirLand's nominated adviser Investec Bank PLC.
The directors found that the terms of the transaction "are fair and reasonable insofar as its shareholders are concerned", MirLand said.
Shares in MirLand were untraded on Thursday, having last traded at 32.00 pence.
By Hannah Boland; [email protected]; @Hannaheboland
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
MLD.L