General — 11 December 2012

Company considers raising more debentures in 2013

The Belize Electricity Limited (BEL) announced that it is closing the series 5 debenture offer for BZ$25 million, launched on November 15, 2012, eleven days early, because it has been fully subscribed. BEL reported that “as of today, these subscriptions are for over $14 million in excess of the $25 million offer.”

The series 5 debenture offer, which pledges a fixed interest rate of 7% to mature in 12 years on December 31, 2024, is being sold in multiples of $100. The offer was not due to close until December 17.

The Belize Social Security Board (SSB) is purchasing $5 million worth of debentures, in addition to $10 million in preference shares from the government-owned utility company.

BEL, understandably, is happy about the outcome of the debenture offering. BEL’s Senior Manager Finance & Human Resources, Betty Tam, said in a statement, “We appreciate the high interest in our offer and thank all subscribers to the series 5 debentures. We stand on a strong record as we have consistently paid interest on time to holders of our series 1, 2, 3 and 4 debentures. Holders of our series 5 debentures can expect the same consistency from us going forward.”

The proceeds of the series 5 debentures will come just in time for BEL to pay those who had subscribed to its first debentures, due at the end of December 2012.

“With the proceeds from this debenture offer, the company will in whole or in part refinance its $16.9 million series 1 debentures currently bearing interest at 12% and maturing on December 31, 2012; as well as help fund the company’s medium-term needs,” BEL had previously explained.

Tam notes that BEL is considering opening another offer in 2013 to facilitate its 5-year service expansion and initiatives.

“Another offer will also meet the demand for the company’s debentures, as persons/parties continue to submit subscriptions to the company…” BEL said.

The interest rate on the BEL debenture is more attractive than current deposit rates in the financial sector, and allows BEL to raise financing at a lower interest rate than the going rate at commercial financial institutions.

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