The manager of EC World REIT says its board assessed that the REIT “remains as a going concern” on Nov 22 after the lenders of its existing offshore bank loans and existing onshore bank loans had asked the REIT to repay the mandatory repayment amount by Dec 31.
In its statement, the REIT manager says that its board continues to expect that the repayment of the mandatory repayment amount and refinancing of the remaining facilities will be completed before these borrowings become due for repayment.
On June 1, the REIT manager announced that it had entered into an agreement with its offshore borrowers, ECW Treasure Pte. Ltd. and Zhejiang Fuzhou E-Commerce Co., Ltd., to extend the maturity of its offshore facilities to April 30, 2023.
The loan facilities had an outstanding aggregate principal amount of $299.95 million and US$86.78 million ($119.79 million).
The REIT was supposed to ensure that at least 25.0% of the aggregate principal amount of the outstanding offshore facilities is repaid by Dec 31.
The news comes after the REIT says its divestments may face a potential delay on Nov 20. DBS Group Research, on Nov 21, had downgraded its recommendation, noting that the REIT faced fresh doubts on its ability to refinance its loans.
See also: EC World REIT's refinancing raises concerns despite analysts' upbeat report
“A delay in the divestments could lead to a breach by ECWREIT’s lenders to refinance both offshore and onshore loans due on April 30, 2023,” noted analysts Dale Lai and Derek Tan at the time.
