Re-structured Debt Facility and Board Appointment

16 June 2021

Mercantile Ports & Logistics Limited

("MPL", the "Group" or the "Company")

Re-structured Debt Facility

and

Board Appointment

Mercantile Ports & Logistics Limited, which is operating and developing out its port and logistics facility in Navi Mumbai, Maharashtra, India is pleased to announce that it has successfully negotiated and executed a re-structured debt facility with its consortium of banks that both takes into account the significant progress made with business at its Karanja port and logistics facility while also recognising the acute disruption in India caused by the Covid-19 pandemic. 

The terms of the re-structured debt facility are favourable to the Company, in summary:

·    Debt Interest Rate lowered from 13.45% to  9.5% per annum.

·    There will be a moratorium on interest rate payments until February 2022 in recognition of the severity of the Covid-19 pandemic which is currently impacting India. 

·   The commencement of the amortisation of the principal loan amount has also been extended by 24 months from October 2020 to October 2022. 

While the interest moratorium and extended amortisation period are a feature of the Reserve Bank of India's Covid-19 relief policy, MPL is pleased to note that the almost 400 bps reduction in the interest rate is based on the consortium banks own independent viability report on MPL's business on the ground. The terms of the re-structured debt facility underscore that the facility is now revenue generating and has a healthy pipeline of future customers. 

MPL is also pleased to announce the appointment of Peter Mills as a Non-Executive Director and Chair of the audit committee with immediate effect.

Peter is an experienced Chairman and Board member, both non-executive and executive, with a strong corporate governance and regulatory understanding. He has a widespread industry knowledge with approximately 30 years in onshore and offshore financial services markets and broad involvement with government and regulators. Having qualified as a Chartered Accountant in 1996, his directorships have included banking groups, fund management companies, fiduciary services companies, listed and unlisted investment funds, captive insurance company and leasing companies. His fund management and investment fund roles have predominately been in the infrastructure, private equity and property asset classes.

Jeremy Warner Allen, Chairman of MPL said, "The restructured debt facility is testament to the growing strength of MPL's business. The opportunities now available to MPL are significant and it is very pleasing to note that our consortium of banks endorse our business.

"Our Karanja based port and logistics facility has moved from being a development project to becoming a revenue generating asset. While the Covid-19 pandemic has, as for many companies in India and around the world, had an impact on our business, I am pleased about the progress that has been made by our business development team. While navigating the Covid-19 restrictions, they have continued to sign new customers and develop a healthy pipeline of new business that could use the facility.

"I am also delighted to welcome Peter Mills to the MPL Board. His extensive experience will bring invaluable skills and expertise to the Group especially in his role as Chair of the Audit Committee."

Jay Mehta, CEO of MPL stated, "The restructuring of our debt facility is an important milestone. Our consortium of bankers, after conducting their own diligence and viability studies in conjunction with independent rating agencies, have deemed our business worthy of a significant reduction in interest rate on our term loan.

"I am also particularly pleased that the moratorium in principal payments and interest payments gives significant flexibility to our business as we navigate around the global pandemic. We continue to make progress with potential end customers and will further update the market in due course".

This announcement contains inside information.

Further information pursuant to Schedule Two, paragraph (g) of the AIM Rules:

Peter David Mills, aged 51, is currently or has previously been a director of the following companies within the past five years:

Current Directorships

Past Directorships

There is no further information required to be disclosed pursuant to Schedule Two, paragraph (g) of the AIM Rules for Companies

Peter holds no interest in the Company's shares

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