KARACHI: The board of directors of K-Electric in a meeting on Wednesday “approved, in principle, the issue of KE Sukuk of up to Rs22 billion, including green shoe option of up to Rs2bn,” K-Electric announced at the stock exchange on Wednesday.

The utility said that the issue was subject to completion of all statutory requirements and after obtaining all regulatory approvals, including SBP’s approval for prepayment of foreign currency portion and completing requisite corporate actions.

Finance and Company Secretary at K-Electric Mohammad Rizwan Dalia observed that the proceeds of Sukuk would be primarily utilised to pre-pay the existing long term debt to obtain benefit of improved pricing and extended maturity profile.

“The Sukuk will help in significantly reducing the borrowing cost with a positive impact on company’s profitability and cash flow,” Dalia said and added that it would also help in promoting Islamic capital market in Pakistan.

Published in Dawn, June 26th, 2014