Enterprise Inns concludes new refinancing deal
SOLIHULL pubco, Enterprise Inns, has agreed the terms of a partial refinancing of its 2018 bonds and concluded a new £138m revolving credit facility.
The company said the partial refinancing would result in a lower interest cost to itself and an extended debt maturity, through proactively addressing the 2018 bonds.
Enterprise has also agreed the terms on which its existing bank facility will be replaced by a new revolving credit facility on improved terms. Completion of the refinancing transactions is expected to take place on Tuesday (October 7) and is subject to final documentation and other standard conditions being met.
The company said it had received and accepted tender instructions for £249,521,000 of its outstanding 6.500% secured bonds due 2018 pursuant to the terms of its previously-announced tender offer.
The bonds will be purchased at a price of 108.75% of their principal amount. In connection with the tender and purchase, a new issue of £249,521,000 of secured bonds has been priced with a maturity of October 2023 and a coupon of 6.00%. Enterprise said the new issue would benefit from a security package on substantially the same terms as the tendered and purchased 2018 bonds.
Enterprise has also signed a new £138m non-amortising revolving credit facility which, upon completion of the refinancing, will be available through to September 2018.
This deal extends the maturity of the company’s previous facility and also benefits from improved terms, simplified covenants and lower pricing with a new interest rate of 300 basis points above LIBOR. This facility will replace the existing amortising facility, which currently stands at just over £140m.
The new bank facility will be provided by Deutsche Bank, RBS, Barclays, BNP Paribas and Lloyds Bank. Deutsche Bank and RBS acted as dealer managers for the bond tender and along with Barclays were global-coordinators of the new bond issue, with BNP Paribas and Lloyds Bank acting as bookrunners on the new issue.
Simon Townsend, Enterprise CEO, said: “The success of this proactive refinancing builds upon the positive momentum we are delivering within the business. The continued support of our core relationship banks and bondholders is further evidence of the strength of the Enterprise Inns business and our secure, long term capital structure. We continue to work hard to deliver improving returns to all stakeholders and these actions are another important step forward in this regard.”
