Portfolio Update

RNS Number : 6417P

Sequoia Economic Infra Inc Fd Ld

20 October 2021

 

20 October 2021

Sequoia Economic Infrastructure Income Fund Limited

("SEQI" or the "Company")

Portfolio update

As recently noted in the Investment Update for 30 September 2021, Salt Lake Potash or SO4 (representing 1.9% of NAV as at 30 September 2021) was seeking further funding by means of an equity issue to address additional cost and ramp up requirements at their Lake Way potash project. The proposed equity raise has been unsuccessful and Salt Lake Potash have announced a Voluntary Administration of the company as at 20 October 2021.

The Investment Adviser had been developing a contingency plan should the funding gap not be addressed. This contingency plan has now been activated in full alignment with the lender group. The lender group has appointed KordaMentha, a leading Australian restructuring and advisory firm, as receivers for the lender group.

Please refer to KordaMentha's press release on their appointment as receivers here:

https://www2.asx.com.au/markets/trade-our-cash-market/announcements.so4

Under Australian restructuring processes, receivers act for the benefit of lenders and can take a variety of measures including trade sales of the company, debt sales or other restructuring activities to preserve lender value and maximise recovery. The Investment Adviser notes that the cost base of the project and equity invested to date materially exceeds the total debt quantum and that a similar potash project utilising evaporative production processes for sulphate of potash production has recently achieved first production, albeit with reportedly similar ramp-up issues as SO4. Whilst it is too early and speculative to comment on the eventual recovery percentage of our investment, our senior secured position should position us strongly in the restructuring process.

A further update will be provided as and when appropriate. 

For further information please contact:

Sequoia Investment Management Company  [phone]

Steve Cook

Dolf Kohnhorst

Randall Sandstrom

Greg Taylor

Anurag Gupta

Jefferies International Limited  [phone]

Gaudi le Roux

Neil Winward

Tulchan Communications (Financial PR)                                      [phone]

Martin Pengelley

Elizabeth Snow

Deborah Roney

Praxis Fund Services Limited (Company Secretary)                  [phone]

Matt Falla

Katrina Rowe 

About Sequoia Economic Infrastructure Income Fund Limited

The Company seeks to provide investors with regular, sustained, long-term distributions and capital appreciation from a diversified portfolio of senior and subordinated economic infrastructure debt investments. The Company is advised by Sequoia Investment Management Company Limited.

LEI: 2138006OW12FQHJ6PX91

 

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