Loads shareholders approve Rs903m loans for subsidiary

According to Mettis Global, shareholders of Loads Ltd (LOADS) backed two loan facilities for subsidiary Multiple Autoparts Industries (Private) Limited (MAIL) at the company's 46th Annual General Meeting, with combined ceilings of up to Rs902.56m. The larger facility, up to Rs652.56m, will be created by offsetting an equal sum MAIL already owes the company, so no new cash will be paid out. The second facility, capped at Rs250m, can be drawn in several instalments as long as outstanding principal stays within that limit. Both are aimed at MAIL's working capital needs, while the second can also cover its financial obligations.

Both loans carry a markup of 3-month KIBOR plus 3.00% per annum, paid quarterly in arrears, with a tenor of up to seven years. Neither loan is secured, and principal is repayable on demand no later than the seventh anniversary. The markup must also respect the minimum return set by applicable rules, and overdue sums on the first loan attract a further 2.00% a year.

The CEO, CFO and company secretary can each sign the agreements and related documents, broadly in line with the approved terms. Any change that lifts the approved amounts or materially eases the commercial terms would need fresh sign-off under the law. The company disclosed the approvals to the exchange in a notification.