Exicom Tele-Systems Funds Subsidiaries with ₹175 Crore Loan for USA, Australia Expansion

Exicom Tele-Systems Limited has announced in a stock exchange filing that the company, on August 22, 2024, has entered into a Loan Agreement with its wholly-owned subsidiary, Exicom Power Solutions B.V., based in the Netherlands. Under this agreement, Exicom Tele-Systems will grant an unsecured loan amounting to ₹175.00 crore.

The primary objective of this loan is to support the expansion and growth initiatives of Exicom Power Solutions B.V.’s wholly-owned subsidiaries located in the USA and Australia. The funds provided will be directed towards these subsidiaries’ core business activities and development efforts, aiming to enhance their operational capabilities and facilitate their business growth.

The Loan Agreement outlines several key terms:

1. Interest Rate: The loan will bear an interest rate of 12.50% per annum. Interest payments will be due monthly, with the possibility for the company to adjust the rate at its discretion based on the Borrower’s request.
2. Disbursement: The loan amount may be disbursed in one or more instalments or tranches, as determined by Exicom Tele-Systems based on the Borrower’s needs. Each tranche will adhere to the terms of the Agreement and be considered a part of the single loan arrangement.
3. Mode of Disbursement: Funds will be disbursed either by direct credit to the Borrower’s designated bank account or through a Demand Draft or Cheque drawn on the Company’s account.

Significantly, the Agreement does not include provisions related to appointing directors, subscription rights in the event of new share issuance, or restrictions on changes to the Borrower’s capital structure. This approach ensures that the primary focus remains on facilitating growth and expansion for the subsidiaries without additional corporate governance implications.

This strategic financial move underscores Exicom Tele-Systems’ commitment to bolstering its international subsidiaries and enhancing its global presence through targeted investment and support.

On August 26, 2024, the share price of Exicom Tele-Systems Ltd opened at ₹402.00, touching the day’s high at ₹403.95, as of 9:39 AM on the NSE.

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