The units in EC World REIT BWCU will remain suspended, says the REIT manager.
This is after the REIT’s trustee has determined that it is in the REIT’s unitholders’ best interests that the REIT’s units remain suspended.
In a Sept 21 announcement, the REIT manager pointed out that the REIT’s current liabilities exceeded its current assets by $117.9 million as at June 30. The REIT’s current liabilities and its subsidiaries have exceeded the group’s current assets by $133.2 million.
“Within its current liabilities, the EC World Group has borrowings of $443.2 million (including amounts presented within liabilities directly associated with disposal group classified as held for sale) which are due for repayment within the next 12 months from the reporting date of June 30,” reads the statement put out by the REIT on Sept 21.
The tenure for the REIT’s existing offshore facilities is for 11 months ending on April 30, 2024. The tenure of the facilities may be extended for another 24 months not going beyond April 30, 2026, depending on whether certain conditions have been met.
“At this juncture, the manager understands from the offshore lenders that their approval of the extension of the initial termination date [of April 30, 2024] would be contingent on the ECW Group’s successful completion of the proposed divestment of Stage 1 Properties of Beigang Logistics and Chongxian Port Logistics and the ECW Group making certain mandatory repayments in the amount agreed or to be agreed by all the existing lenders under the existing onshore facilities of the ECW Group and all the offshore lenders,” continues the REIT’s statement.
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As at Sept 21, the REIT also owes its sponsor, Forchn Holdings, overdue rent that exceeds an amount of RMB145.8 million. The REIT manager says it is working with its sponsor on a repayment plan.
It adds that the suspension of the REIT’s units will provide it more time to work on resolving its “uncertainties” including securing the requisite funding to complete the proposed divestment among other things.
Units in EC World REIT last traded at 28 cents.
