Panostaja pay off loans and updates financial targets.
M2 EQUITYBITES-June 28, 2018-Panostaja pay off loans and updates financial targets
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Finnish investment company Panostaja Oyj (HEL:PNA1V) announced on Wednesday that it has paid off all of the parent company's interest-bearing liabilities in the amount of EUR22.3m and signed an agreement on a new EUR15.0m corporate acquisition limit.
Reportedly, this limit can be used to take out three-year credit loans for the parent company to fund corporate acquisitions. The new corporate acquisition limit will replace the previous corporate acquisition limit.
According to the company, paying off the parent company's interest-bearing liabilities is part of the goal regarding its new financial structure, which is intended to be debt-free in a normal situation. The parent company may incur debts temporarily to fund corporate acquisitions between divestments.
Also, paying off the parent company's interest-bearing liabilities changes the parent company's financial structure dramatically and reduces Panostaja's risk. The lower risk is also reflected by Panostaja's profit target.
As a part of this change, Panostaja's board of directors has also approved updated financial goals for Panostaja.
Now, as a result of the parent company's new debt-free financial structure, the board has set 15% as the new long-term return on equity target and 40 % as the equity ratio target for the group. The prior targets were 20% and 40%, respectively, when including subordinated loans in the equity. Other long-term financial goals and the dividend policy will remain unchanged.
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|Publication:||M2 EquityBites (EQB)|
|Date:||Jun 28, 2018|
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