Najran Cement’s sukuk holders waive right related to SAR 400 mln sukuk

Najran Cement Co.’s Sukuk holders have waived any right that may result from regulations and conditions of the SAR 400 million Sukuk, maturing in June 2020, due to non-compliance with the financial conditions ending at Dec. 31, 2017.

The issuer has also undertaken that the ratio of net aggregate debt to aggregate profit before deducting interest, Zakat, depreciation and amortization will not exceed 3.5 times, the cement producer said in a bourse statement.

The company’s general assembly has also agreed to waive clause 7 (d) of the sukuk contract terms, which stipulates that interest coverage ratio will not fall below 4 times until the end of 2019.

The general assembly also approved raising the sukuk’s margin by 75 percent with an additional increase of 25 percent in case of the on-compliance with clauses 7 (d) and 7 (e) at the beginning of 2020.

It also approved amending some of the sukuk terms for long-term financing and violations of the terms and conditions of the sukuk.

The decisions made by the company’s general assembly will result in SAR 3 million increase in lending cost every year, the statement added.

In June 2015, Najran Cement had launched its SAR 400 million Shariah compliant sukuk with tenure of five years