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Tabreed Secures up to a AED 3.1 Billion in new Long-term Capital

Wednesday, March 02, 2011

Recapitalization program scheduled to close by 31 March

Abu Dhabi, 2 March 2011 – National Central Cooling Company PJSC (‘Tabreed’ or ‘the Company’), the world’s leading district cooling company, today announced that it has reached an agreement-in-principle with Mubadala Development Company PJSC (‘Mubadala’) to provide up to AED 3.1 billion in new long-term capital commitments. Upon closing the recapitalization program, Tabreed will have the long-term capital structure required to transform its business and realize disciplined growth.

Long-term Capital
Under the agreement, Mubadala will commit up to AED 3.1 billion in new long-term capital
comprised of:

  • AED1.7 billion Subordinated Mandatory Convertible Notes (the ‘Subordinated Notes’) to refinance the Company’s existing AED 1.7 billion Bridge Financing. The Notes mature in 2019, have a conversion price of approximately AED1.13 and are convertible by the Holders on certain dates.
  • Up to AED1.4 billion Subordinated Convertible Loan Facility, which may be drawn by the Company to satisfy certain liquidity needs, complete its build-out program and pursue near-term growth opportunities. The facility matures on 31 December 2012, and to the extent not repaid, the drawn amount will convert into additional Subordinated Notes.

The Company may repurchase a portion of the Subordinated Notes in the future. The Subordinated Notes will be transferable to shareholders and other investors interested in participating in the new instruments.

Khadem Al Qubaisi, Tabreed’s Board Chairman commented: “The Board of Directors is pleased that Tabreed has successfully entered the final stages of its recapitalization program. Tabreed has reached an AED 2.63 billion refinancing agreement with its banks and secured up to AED 3.1 billion in long-term capital commitments from its strategic investor.

This program provides the foundation for future growth and we look forward to closing this program by 31 March. The Company’s potential has been underscored by its performance over the last four quarters, which demonstrates the management team’s determination in building the business. By delivering value and dependability to our institutional clients, Tabreed will meet future demand for cooling infrastructure in the region.”

Khaled Al Qubaisi, Tabreed’s Managing Director commented: “Following the successful completion of the recapitalization program, Tabreed will be in a stronger position to deliver on its business plan and achieve its full earnings potential. Management’s focus will be on completing Tabreed’s build-out program, developing the Company’s core chilled water business, and increasing profitability by enhancing value from existing plants while maximizing organizational and operational efficiencies.’’

08 Sukuk
The Company has also today launched an amendment process to settle the AED246.5 million annual distribution amounts under its convertible 08 Sukuk. The amendment process comprises a tender offer and proposal that on completion will result in the annual distribution amounts being settled in ordinary shares. The amendment process is also scheduled for completion by 31 March.

The issuance of the Notes and the completion of the amendment process are subject to regulatory approval. Complete terms of the recapitalization program elements can be foundin the 2 March 2011 Analyst Presentation at www.tabreed.com/InvestorsReport.aspx

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