Pursuant to our material event disclosure dated 10.04.2020, Standard & Poor's upgraded Vestel Elektronik's long term corporate credit rating from "SD" to "CCC-". The outlook on the rating is negative.
Standard & Poor's has temporarily downgraded Vestel Elektronik's long term corporate credit rating from "CCC+" to "SD" on April 10, 2020. The rating revision is due to Company's plan to extend the maturity of some of its financial obligations due until June 2020 in consent with related financial institutions and the impact of Covid-19 on operations. S&P will reassess the rating once the process for maturity extension is completed
Pursuant to our material event disclosure dated 25.03.2020, Vestel Elektronik will resume its production activities as of April 6, which were temporarily suspended during March 30 and April 5 within the framework of the precautions taken to reduce the effects of the global Coronavirus pandemic to protect the health of employees and the public. The plants will start operations with a lower capacity due to measures taken such as rescheduling of shift hours, reduction in the number of employees working per shift, disinfection of work areas during the breaks between the shifts and maintaining social distance in physical working conditions. If circumstances and developments require, an application for short-term work allowance will be considered.
Due to the worldwide effects of the Coronavirus (COVID-19) outbreak and with Europe, which is Vestel Elektronik’s major export market, becoming the new epicenter of the pandemic, Vestel Elektronik started to receive requests from its international clients to defer orders. As a result, the Company, which exports most of its output abroad, will suspend production at its plants for one week between March 30 and April 5. The other operations of the Company will continue within the framework of the numerous health and safety measures already taken. Important developments on the subject will be announced to the public.
Pursuant to our material event disclosure dated 17.02.2020, Vestel Elektronik has been notified today that the Capital Markets Board had approved the Company's application to issue debt instruments. The approved issue document is presented in the attachment.
Click for Corporate Bond.
Pursuant to our material event disclosure dated 12.03.2020, Capital Markets Board has approved Vestel Elektronik's application to obtain the required permission to amend the sixth article of its Articles of Association titled "Company's Share Capital and Kind of Share Certificates" for extending the validity period of its registered capital ceiling for 5 years, involving the 2020-2024 period.
In accordance with the article 18 of the Capital Market Law and the Communiqué on Authorised Capital System of the Capital Markets Board (the Communiqué), Vestel Elektronik (the Company) decided to amend the sixth article of its Articles of Association titled "Company's Share Capital and Kind of Share Certificates" for extending the validity period of its registered capital ceiling for 5 years, involving the 2020-2024 period. Within this scope, the Company decided to apply to the Capital Markets Board and Ministry of Trade to obtain the required permission and submit the afore-mentioned amendment for the approval of shareholders in the first upcoming General Assembly.
Vestel Elektronik announced consolidated sales revenues of TL 17,174 mn (US$ 3,028 mn) and net profit of TL 352 mn (US$ 62 mn) in 2019.
Click here for FY19 CMB financials
Vestel Polska Technology Center sp. z o.o., which is %100 owned by our wholly-owned subsidiary Vestel Ticaret AŞ ("Vestel Ticaret"), transferred its TV assembly facility together with its building and land in Wroclaw Poland to LG Chem Wrocław Energy Sp. zo.o. for USD 31.4 million on February 28, 2020. Polish transaction advisory firm JP Weber Dudarski sp.k. has acted as the exclusive sell-side advisor to Vestel Elektronik Sanayi ve Ticaret AŞ.
The title of Compal Electronics Europe sp. z o.o., which was acquired on December 30, 2016 within the scope of the brand licensing agreement signed with Toshiba Visual Solutions Corporation on September 1, 2016, was changed to Vestel Polska Technology Center sp. z o.o. after the acquisition.
The afore-mentioned facility is a TV assembly plant, which is being sold as part of cost optimization.
The fixed asset sale of our indirect subsidiary Vestel Polska Technology Center sp. z o.o., is not considered to be a "Material Transaction" as per the materiality criteria calculations done pursuant to the Capital Markets Board's "Communiqué on the Common Principles Regarding Material Transactions and the Right to Dissociate (II-23.1).
Public disclosure of the afore-mentioned fixed asset sale transaction was postponed until the signing of a binding sale agreement with a Board resolution dated 21.02.2020 and numbered 2020/9 in accordance with the Article 6 of the Capital Markets Board's Communiqué on Material Events Disclosure. The announcement was postponed as the signing of a binding sale agreement was not certain at the time of the signing of the non-binding offer letter between the parties in order not to mislead investors. This disclosure is made as the reason for the postponement has ended with the signing of a final sale agreement and completion of the sale transaction.
SAHA Kurumsal Yönetim ve Kredi Derecelendirme Hizmetleri AŞ (“SAHA”), which is authorised to provide rating services in Turkey in accordance with the Capital Markets Board’s (“CMB”) Corporate Governance Principles, revised up Vestel Elektronik’s Corporate Governance Rating from 9.59 (95.87%) to 9.63 (96.32%) as of February 21, 2020.
The Company’s Corporate Governance Rating has been determined as a result of the evaluations made under four main headings (Shareholders, Public Disclosure and Transparency, Stakeholders, Board of Directors) in accordance with the CMB's Corporate Governance Principles. The breakdown of the Company’s Corporate Governance Rating by sub-section is as follows:
| Sub-Sections | Weights (%) | Rating (%) |
|---|---|---|
| Shareholders | 25 | 94.91 |
| Public Disclosure and Transparency | 25 | 98.44 |
| Stakeholders | 15 | 99.48 |
| Board of Directors | 35 | 94.47 |
| Total | 100 | 96.32 |
The Company’s revised rating, which is determined by SAHA in accordance with the Corporate Governance Principles, confirms Vestel Elektronik’s determination to adopt corporate governance principles and the improvements made in the implementation of necessary policies and measures. The afore-mentioned report is available on our Company's website at www.vestelinvestorrelations.com.