Agha Steel Industries Ltd (ASIL), the fully automatic leading Steel Re-Rolling Manufacturing Company in Pakistan, planned to raise around two billion rupees through a Rated, Secured and Privately Placed Sukuk with the option of listing under chapter 5C of the PSX rule book in the ongoing year (expected drawdown in June’22), a press release issued by VIS said.
As per the official statement from the steel Re-Rolling Manufacturing Company, the instrument shall have ten or fifteen months from the first drawdown date, with a call option being available after one year.
The proposed Sukuk has been assigned the preliminary rating of A (Single-A) by the credit rating agency VIS.
Proceeds from the issuance will be utilized for the settlement of conventional short term financing facilities up to Rs. 1.5b and to finance the ongoing capital expenditure of the company.
Profit will be paid on a quarterly basis at a rate of 3 Months KIBOR + 125 bps, with initial payment due at the end of three months from the first drawdown date. Principal bullet repayment will be made on the 15th month from the date of the issue.
The assigned rating factor in the security structure of the instrument encompasses the first joint pari passu hypothecation charge over all present and future current assets of the Company with a 25% margin, personal guarantees of sponsor directors of the organization, and ranking charge over the present and future fixed assets of the Company with 25% margin, VIS said.
In addition, the Sukuk rating remains dependent upon projected improvement in liquidity profile and leverage indicators, for which timely completion of the expansion project is considered important, it added.
Agha Steel Industries Ltd
ASIL represents one of the largest private-sector investments in the steel industry of Pakistan. ASIL is the fastest growing steel manufacturer in Pakistan, which prides itself in its focus on continuously improving the quality of its products. ASIL is Pakistan’s first completely automatic Rolling Mill with 17 Stand – 2 Strand, having a capacity to make Re-Bars ranging from 9.5mm to 40mm at the maximum speed of 18 m/s, thus leading Pakistan into a new era of steel-making.
The Company is a pioneer in introducing the TMT technology in the country, in conjunction with a fully automated rolling mill. This has enabled the Company to produce high-quality rebars having accuracy in terms of length and grade for meeting the customer’s needs. Pioneer of ASTM A706 Deformed Grade 60-Pakistan’s first Earthquake Resistance rebar.
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