The global supplier of paper solution Lecta, with headquarters in Luxembourg and established following the merger between the Italian Cartiere del Garda in Italia, the French Condat and the Spanish Torraspapel, has successfully completed the total recapitalization announced in September last year and has now a new shareholder base featuring institutions with extensive experience investing in the sector. Last August Lecta, which registered a 1.4 billion euro turnover and 116 million euro Ebidta in 2018, indeed announced a bond restructuring for a total of 600 million euro. The operation will make it possible to strengthen the group financial structure and foresees a new financing agreement with NatWest Markets Plc to provide 115 million euro super senior facilities, consisting of a super senior 60 million euro term loan and a super senior 55 million euro revolving credit facility, as well as the conversion of about 600 million existing notes in new debt and equity instruments, including the issue of 200 million euro new senior secured notes and 100 million euro junior notes. The control of the Group went from Cvc Capital Partners to the bondholders last September.
Lecta Group Executive Chairman Andrea Minguzzi said that Lecta has now a significantly de-levered capital structure and new sources of liquidity, enabling the company to take advantage of new market opportunities. In addition, the company said that support of its operations in France from the French authorities are expected to be confirmed and implemented shortly after the recapitalisation completion date.
The recapitalisation was implemented via the transfer of Sub-Lecta S.A. to be indirectly held by a newly incorporated UK company, Lecta Ltd, and the exchange of existing senior secured notes to new longer dated debt instruments and equity.
Lecta has also entered into an agreement to refinance and replace existing revolving credit facility. It also provides additional liquidity and financial flexibility which it needs for its transformation towards a specialty paper company. The holders of existing senior secured notes will receive new notes and 100% of the equity in the new Lecta company. The new capital structure reduces substantially the company’s cast interest burden and provides longer-dated maturities, Lecta explained.