(Alliance News) - Keystone Investment Trust PLC said Monday it intends to redeem all of its outstanding 7.5% debenture stock 2020 and outstanding 6.5% bonds 2023 on March 13.
The company said the fair values of the stocks and bonds used in calculating the company's net asset value are close to their respective redemption prices.
Therefore the board has taken the view that this is an opportune time to redeem the debt and introduce replacement borrowings in the form of a bank facility, the company explained.
Karen Brade, chair, said: "We are pleased to be able to refinance the company's debt, which introduces more flexible and lower cost borrowings in place of the legacy instruments."
Based on valuations as at February 6, the payment of the aggregate redemption amounts will result in an uplift to net asset value with debt at fair value of 1 pence per share.
In accordance with the trust deed constituting it, the stock will be redeemed at GBP103.87 per GBP100 in principal amount, meanwhile bonds will be redeemed at GBP118.41 per GBP100 in principal amount, the company said.
The redemption of the stock and bonds will be funded from a new GBP45 million committed revolving credit facility provided by The Bank of New York Mellon, London Branch.
Keystone said it will ensure that total financial indebtedness will not exceed 20% of its net assets and that its total assets will at all times exceed GBP150 million.
Keystone shares closed 0.7% lower in London at 1,740.00 pence each on Monday.
By Loreta Juodagalvyte; loretajuodagalvyte@alliancenews.com
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