VALLIBEL FINANCE PLC
PROSPECTUS
AN INITIAL ISSUE OF 20,000,000 DEBENTURES WITH AN OPTION TO ISSUE UP TO A
10,000,000 OF SAID DEBENTURES AT THE DISCRETION OF THE COMPANY IN THE EVENT OF AN OVERSUBSCRIPTION OF THE INITIAL TRANCHE TO RAISE UPTO A MAXIMUM AMOUNT OF LKR 3,000,000,000/-
TO BE LISTED ON THE COLOMBO STOCK EXCHANGE
RATED "BBB STABLE" BY LANKA RATING AGENCY LIMITED
WHICH IS THE MINIMUM INSTRUMENT RATING REQUIRED BY THE CSE
FURTHERMORE, SHOULD THE RATING GO BELOW THE REGULATORY
REQUIREMENT OF THE CSE AT A POINT OF TIME PRIOR TO LISTING, THE DEBENTURE WILL NOT BE LISTED. SHOULD THE RATING GO DOWN POST LISTING, THE INSTRUMENT WILL BE SUBJECT TO ENFORCEMENT ACTIONS AS SET OUT IN THE LISTING RULES
ISSUE OPENS ON
20 NOVEMBER 2024
MANAGERS TO THE ISSUE
FIRST CAPITAL ADVISORY SERVICES (PVT) LTD
VALLIBEL FINANCE PLC
This Prospectus is dated 11 November 2024
The Colombo Stock Exchange ("CSE") has taken reasonable care to ensure full and fair disclosure of
information in this Prospectus. However, the CSE assumes no responsibility for the accuracy of the statements made, opinions expressed, or reports included in this Prospectus. Moreover, the CSE does not regulate the pricing of the Debentures which is decided solely by the Issuer. Please note that the company is bound by the enforcement rules set out in the CSE Listing Rules (as applicable).
The delivery of this Prospectus shall not under any circumstances constitute a representation or create any implication or suggestion that there has been no material change in the affairs of the Company since the date of this Prospectus. If there are material changes, such material changes will be disclosed to the market.
If you are in any doubt regarding the contents of this document or if you require any clarification or advice in this regard, you should consult the Managers to the Issue, investment advisor, lawyer or any other professional advisor.
Responsibility for the Content of the Prospectus
This Prospectus has been prepared by First Capital Advisory Services (Pvt) Limited (hereinafter referred to as Managers to the Issue/ Manager') on behalf of Vallibel Finance PLC (hereinafter referred to as 'VFP' or the 'Company'). VFP and its Directors confirm that to the best of their knowledge and belief this Prospectus contains all information regarding the Company and Debentures offered herein which is material; such information is true and accurate in all material aspects and is not misleading in any material respect; any opinions, predictions or intentions expressed in this Prospectus on the part of the Company are honestly held or made and are not misleading in any material respect; this Prospectus contains all material facts and presents them in a clear fashion in all material respects and all proper inquiries have been made to ascertain and to verify the foregoing. The Company accepts responsibility for the information contained in this Prospectus.
No person has been sanctioned to make any representations not contained in this Prospectus in connection with this offer for Subscription of the Company's Debentures. If such representations are made, they must not be relied upon as having been authorised. Neither the delivery of this Prospectus nor any sale made in the offering shall, under any circumstances, create an implication that there has not been any change in the facts set forth in this Prospectus or in the affairs of the Company since the date of this Prospectus.
Investors should be informed that the value of investments can vary, and that past performance is not necessarily indicative of future performance. In making such investment decisions, prospective investors must rely on their knowledge, perception together with their own examination and assessment on VFP and the terms and conditions of the Debentures issued including risks associated.
The delivery of this Prospectus shall not under any circumstances constitute a representation or create any implication or suggestion, that there has been no material change in the affairs of the Company since the date of this Prospectus.
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Registration of the Prospectus
A copy of this Prospectus has been registered with the Registrar General of Companies in Sri Lanka in accordance with the Companies Act No. 07 of 2007 (The "Companies Act"). The following are the documents attached to the copy of the Prospectus delivered to the Registrar of Companies for registration pursuant to section 40(1) of the Companies Act.
- The written consent of the Auditors and Reporting Accountants to the Issue for the inclusion of their name in the Prospectus as Auditors and Reporting Accountants to the Issue.
- The written consent of the Trustee to the Issue for the inclusion of their name in the Prospectus as Trustee to the Issue.
- The written consent of the Bankers to the Issue for the inclusion of their name in their Prospectus as Bankers to the Issue.
- The written consent of the Company Secretary for the inclusion of their name in the Prospectus as Company Secretary.
- The written consent of the Managers to the Issue for the inclusion of their name in the Prospectus as the Managers to the Issue.
- The written consent of the Registrars to the Issue for the inclusion of their name in the Prospectus as Registrars to the Issue.
- The written consent of the Lawyers to the Issue for the inclusion of their name in the Prospectus as Lawyers to the Issue.
- The written consent of the Credit Rating Agency to the Issue for the inclusion of their name in the Prospectus as the Credit Rating Agency to the Issue and to the Company.
- The declaration made and subscribed to, by each of the Directors of the Company herein named as a Director, jointly and severally confirming that each of them have read the provisions of the Companies Act and the CSE Listing Rules relating to the Issue of the Prospectus and that those provisions have been complied with.
- The said Auditors and Reporting Accountants to the Issue and to the Company, Trustee to the Issue, Bankers to the Issue and Company, Company Secretary, Managers to the Issue, Registrars to the Issue, Lawyers to the Issue and Credit Rating Agency have not, before the delivery of a copy of the Prospectus for registration with the Registrar General of Companies in Sri Lanka, withdrawn such consent.
Registration of the Prospectus in Jurisdictions Outside of Sri Lanka
This Prospectus has not been registered with any authority outside of Sri Lanka. Non-resident investors may be affected by the laws of the jurisdiction of their residence. Such investors are responsible to comply with the laws relevant to the country of residence and the laws of Sri Lanka, when making the investment.
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VALLIBEL FINANCE PLC
Investment Considerations
It is important that this Prospectus is read carefully prior to making an investment decision. For information concerning certain risk factors, which should be considered by prospective investors, see Section 5.16 'Risks Involved in Investing in the Debentures' of this Prospectus.
Forward Looking Statements
Any statements included in this Prospectus that are not statements of historical fact constitute 'Forward Looking Statements'. These can be identified by the use of forward-looking terms such as 'expect', 'anticipate', 'intend', 'may', 'plan to', 'believe', 'could' and similar terms or variations of such terms.
However, these words are not the exclusive means of identifying Forward Looking Statements. As such, all or any statements pertaining to expected financial position, business strategy, plans and prospects of the Company are classified as Forward-Looking Statements.
Such Forward Looking Statements involve known and unknown risks, uncertainties and other factors including but not limited to regulatory changes in the sectors in which the Company operates and its ability to respond to them, the Company's ability to successfully adapt to technological changes, exposure to market risks, general economic and fiscal policies of Sri Lanka, inflationary pressures, interest rate volatilities, the performance of financial markets both globally and locally, changes in domestic and foreign laws, regulation of taxes and changes in competition in the industry and further uncertainties that may or may not be in the control of the Company.
Such factors may cause actual results, performance and achievements to materially differ from any future results, performance or achievements expressed or implied by Forward Looking Statements herein. Forward Looking Statements are also based on numerous assumptions regarding the Company's present and future business strategies and the environment in which the Company will operate in the future.
Given the risks and uncertainties that may cause the Company's actual future results, performance or
achievements to materially differ from that expected, expressed or implied by Forward Looking Statements in this Prospectus, investors are advised not to place sole reliance on such statements.
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VALLIBEL FINANCE PLC
OFFER AT A GLANCE
Issuer | Vallibel Finance PLC | |||||||||
Type of Debt | Listed, Rated, Subordinated, Unsecured, Redeemable Debentures | |||||||||
Security/Debenture | ||||||||||
Listing | The Debentures will be listed on the Colombo Stock Exchange | |||||||||
Number of Debentures to | In the event of the Debenture issue being fully subscribed, the Debentures | |||||||||
be issued | issued are up to a maximum of 30,000,000 (Thirty Million) Debenture. | |||||||||
Sri Lankan Rupees Two Thousand Million (LKR 2,000,000,000/-) with an | ||||||||||
Aggregate Face Value/ | option to raise Sri Lanka Rupees One Thousand Million (LKR 1,000,000,000/- | |||||||||
Investment Value of the | ) at the discretion of the Company in the event of an oversubscription of the | |||||||||
Issue | initial tranche in order to raise up to a maximum of Sri Lankan Rupees Three | |||||||||
Thousand Million (LKR. 3,000,000,000) | ||||||||||
Issuer Rating | BBB+ with Outlook Stable by Lanka Rating Agency Limited | |||||||||
Issue Rating | BBB with Outlook Stable by Lanka Rating Agency Limited | |||||||||
Par Value | LKR 100.00 per Debenture | |||||||||
Issue Price | LKR 100.00 per Debenture | |||||||||
Interest Rates | ||||||||||
Type of | Interest rate | |||||||||
Debentures | (per annum) | |||||||||
Type A | Fixed Rate of 12.95% p.a. payable semi- annually | |||||||||
(AER 13.37%) | ||||||||||
Type B | Fixed Rate of 13.37% p.a. payable annually | |||||||||
(AER 13.37%) | ||||||||||
Maturity/ Redemption | 05 Years | |||||||||
from the Date of Allotment | ||||||||||
Minimum Number of | Minimum subscription per application is 100 debentures Sri Lankan Rupees | |||||||||
Debentures to be | Ten Thousand (LKR 10,000) and applications exceeding the minimum | |||||||||
subscribed | subscription should be in multiples of 100 debentures. | |||||||||
Type A : The dates on which payments of interest in respect of Type A | ||||||||||
Debentures shall fall due, which shall be six (06) months from the Date of | ||||||||||
Allotment and every six (06) months therefrom of each year from the Date of | ||||||||||
Allotment until the Date of Redemption and includes the Date of Redemption. | ||||||||||
Type B : The dates on which the payments of interest in respect of the Type B | ||||||||||
Interest Payment Dates | Debentures shall fall due, which shall be the twelve (12) months from the Date | |||||||||
of Allotment and every twelve (12) months therefrom of each year from the | ||||||||||
Date of Allotment until the Date of Redemption and includes the Date of | ||||||||||
Redemption. | ||||||||||
Interest would be paid not later than Three (03) Market Days from each | ||||||||||
Interest Payment Date. | ||||||||||
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Type A: The six (06) month period from the date immediately succeeding a | ||||||
particular Interest Payment Date and ending on the next Interest Payment Date | ||||||
(inclusive of the aforementioned commencement date and end date) and shall | ||||||
include the period commencing from the Date of Allotment and ending on the | ||||||
first Interest Payment Date (inclusive of the aforementioned commencement | ||||||
date and end date) and the period from the date immediately succeeding the | ||||||
last Interest Payment Date before the Date of Redemption and ending on the | ||||||
date immediately preceding the Date of Redemption (inclusive of the | ||||||
aforementioned commencement date and end date) | ||||||
Interest Period | ||||||
Type B: The twelve (12) month period from the date immediately succeeding a | ||||||
particular Interest Payment Date and ending on the next Interest Payment Date | ||||||
(inclusive of the aforementioned commencement date and end date) and shall | ||||||
include the period commencing from the Date of Allotment and ending on the | ||||||
first Interest Payment Date (inclusive of the aforementioned commencement | ||||||
date and end date) and the period from the date immediately succeeding the | ||||||
last Interest Payment Date before the Date of Redemption and ending on the | ||||||
date immediately preceding the Date of Redemption (inclusive of the | ||||||
aforementioned commencement date and end date). | ||||||
Principal Sum and Interest will be paid to Debenture Holders through an | ||||||
Method of Payment of | electronic fund transfer mechanism recognized by the banking system of Sri | |||||
Principal and Interest | Lanka such as SLIPS and RTGS in the event accurate bank details have been | |||||
provided, or by crossed cheques marked "Account Payee Only" in the event | ||||||
accurate bank details have not been provided. | ||||||
Issue Opening Date | 20 November 2024, however, applications may be submitted forthwith | |||||
Closing Date (09 December) or such earlier date at 4.30 pm on which, | ||||||
• The maximum of 30,000,000 debentures being fully-subscribed: or | ||||||
• The Board of Directors of the Company decides to close the Issue upon the | ||||||
initial issue of 20,000,000 debentures becoming fully subscribed | ||||||
In the event the Board of Directors of Company decides to exercise the option | ||||||
Issue Closing Date | to issue the second tranche of 10,000,000 (initial issue of | 20,000,000 | ||||
debentures being fully subscribed) but subsequently decides to close the | ||||||
subscription list prior to full subscription of the second tranche and/or; | ||||||
In the event the Board of Directors of the Company decides to close the | ||||||
Debenture Issue without the full subscription of initial issue of 20,000,000 | ||||||
debentures, such decision is to be notified to the CSE on the day such decision | ||||||
is made and the subscription list will be closed on the following market day at | ||||||
4.30 p.m. | ||||||
Date of Allotment | The Date on which the Debentures will be allotted by the Company to the | |||||
Applicants subscribing thereto. | ||||||
In the event of an oversubscription, the basis of allotment will be decided by | ||||||
the Board of Directors of the Company in a fair manner within Seven (07) | ||||||
Market Days from the Closing Date. As per Board Resolution dated 24th July | ||||||
Basis of Allotment | 2024, the Board has authorized any two Directors to decide on the basis of | |||||
allotment. | ||||||
The Board however shall reserve the right to allocate up to a maximum of 75% | ||||||
of the number of Debentures to be allotted under this Prospectus on a | ||||||
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VALLIBEL FINANCE PLC
preferential basis, to identified investor/s of strategic and operational importance with whom the Company might have mutually beneficial relationships in the future.
Number of Debentures to be allotted to identified investor/s of strategic and operational importance, on a preferential basis will not exceed 75% of the total number of Debentures to be issued under this prospectus under any circumstances, unless there is an undersubscription from the other investors (Investors that do not fall under preferential category).
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VALLIBEL FINANCE PLC
TABLE OF CONTENTS
1.0 | CORPORATE INFORMATION | 1 |
2.0 | RELEVANT PARTIES TO THE ISSUE | 2 |
3.0 | ABBREVIATIONS USED IN THE PROSPECTUS | 3 |
4.0 | GLOSSARY OF TERMS RELATED TO THE ISSUE | 4 |
5.0 | INFORMATION RELATING TO THE ISSUE | 6 |
5.1 | Invitation to Subscribe | 6 |
5.2 | Subscription List | 6 |
5.3 | Objectives of the Issue and Specific Risks Relating to the Objectives | 7 |
5.4 | Interest | 8 |
5.5 | Payment of Principal Sum and Interest | 9 |
5.6 | Inspection of Documents | 9 |
5.7 | Underwriting | 10 |
5.8 | The Minimum Subscription Applicable for Investors | 10 |
5.9 | Cost of the Issue | 10 |
5.10 | Brokerage | 10 |
5.11 | Taxation | 10 |
5.12 | Redemption | 10 |
5.13 | Rating of the Debentures | 10 |
5.14 | Trustee to the Issue | 11 |
5.15 | Rights and Obligations of the Debenture Holder | 11 |
5.16 | Risks Involved in Investing in the Debentures | 12 |
5.17 | Benefits of Investing in the Debentures | 13 |
5.18 | Transfer of Debentures | 13 |
5.19 | Listing | 13 |
6.0 | PROCEDURE FOR APPLICATION | 15 |
6.1 | Eligible Applicants | 15 |
6.2 | How to Apply | 15 |
6.3 | Submission of Applications | 18 |
6.4 | Number of Debentures to be Subscribed | 18 |
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6.5 | Mode of Payment | 18 |
6.6 | Rejection of Applications | 20 |
6.7 | Basis of Allotment | 21 |
6.8 | Banking of Payments | 21 |
6.9 | Refunds | 21 |
6.10 | CDS Accounts and Secondary Market Trading | 22 |
7.0 | FINANCIAL AND OTHER INFORMATION | 23 |
7.1 | Financial Statements & Financial Summary | 23 |
7.2 | Financial Year | 23 |
7.3 | Particulars of Debt and Loan Capital | 23 |
7.4 | Other Debt Securities in Issue - As at the date of the Prospectus | 23 |
7.5 | Key Financial Ratios | 23 |
7.6 | Debt Servicing Details of Vallibel Finance PLC | 24 |
7.7 | Litigation, Disputes and Contingent Liabilities | 24 |
7.8 | Major Shareholders as of 30 September 2024 | 25 |
7.9 | Accountant's Report and 5-yearsummary | 26 |
ANNEXURE I - STATUTORY DECLARATIONS | 44 | |
ANNEXURE II - CREDIT RATING REPORT | 46 | |
ANNEXURE IV - COLLECTION POINTS | 51 | |
ANNEXURE V - CUSTODIAN BANKS | 54 |
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