SMU Needs Equity Capital

SMU Needs Equity Capital

Chile Equity

Chile’s SMU plans to increase its equity capital by $500m after an accounting review revealed higher losses and a breach of debt covenants, the retailer says. The company had undervalued its store-lease obligations by CLP38bn ($75m), leading to a 4.4% drop in Ebitda that means its debt coverage ratio slipped to 1.4x, lower than the 1.5x required in its bond covenants. The equity raise will need to be approved by shareholders, and could result in an a domestic or international market public sale,

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