Gijima rolls over debt

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JSE-listed Gijima has secured additional funding for the next five years through an extension of its long-term debtors' securitisation funding programme.

Gijima's debt funding programme started in July 2006, with the issue of R300 million in class A secured debentures to investors in the capital markets. Half of these debentures mature on 30 June 2012, with the other half due to mature on 30 June 2015.

Those investors with debentures maturing in 2012 have elected to subscribe for a new issue of class A debentures worth R150 million, which will mature at the end of June 2017.

CFO Carlos Ferreira says the “long-term nature of this agreement is particularly significant, and will provide stability and security for our operations and those of our client base”. He says it indicates support for the company.

Recently, Gijima said it would cut between 8% and 12% of its staff costs in a bid to be more competitive and deal with a changing landscape. The company recently lost half an Absa deal and a police desktop contract.

The interest rate has been fixed-linked to a five-year benchmark at the date of issue. Ferreira says the decision to fix the rate was due to economists' expectations that, with interest rates at their lowest level in 40 years, they will increase within the next year.

Gijima continues to trade under cautionary.

Staff Writer

ITWeb's journalist

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