Ncondezi Energy Limited (LON:NCCL) has received support “in principle” for a restructuring of an outstanding US$4.3mln loan plus interest.
The restructuring involves a 12-month extension on existing terms, including 12% annual interest rate and the ability for lenders to swap debt for equity in part or in full at a conversion price of 10p per share
Ncondezi can also nominate to pay the loan off through the issue of shares at a 25% to 30% premium to the 30-day average price.
Half of the amount owed is to Ncondzei’s largest shareholder while 45% is held by the board and management.
The loan matures on 30 November and comprises US$2.1m principal and US$2.2m rolled-up interest.
Completion of the restructuring is expected by the end of the year.
Hanno Pengilly, Ncondezi's chief executive said in a statement: “The restructuring will provide additional time to explore future refinancing options and the company has received several refinancing offers to date.
“Management is concentrating on further de-risking the 300MW Ncondezi power project over the next 3 to 6 months and the proposed restructuring will provide the team with sufficient time it needs to do that.”
Ncondezi aims to build up to a 1,800Mw coal-fired power station in Mozambique.