Enterprise Inns targets debt reduction with new banking facility
MIDLANDS pubco Enterprise Inns has agreed a new banking facility of £220m. The Forward Start Facility , which will start when the firm’s existing facility expires in December next year, has been coordinated by Deutsche Bank and the Royal Bank of Scotland with Barclays, BNP Paribas, HSBC, Lloyds Banking Group, Santander and Scotiabank.
The initial facility is committed through to December 2015, with two further phases each of £75m taking effect from June 2016.
The FSF secures a refinancing package which will allow the Solihull company to implement its strategy of reducing its bank debt, which has fallen from £1.1bn in 2008 to its current level of £446m, of which £389m is drawn net of cash.
The size of the FSF is based on the company’s cash generation and the disposal plan as set out in its half year results statement in May, in which the company said that for the year to September 2012 it expects to dispose of assets worth around £200m, followed by a further £150m next year.
The company has said the deal is competitively priced.
Ted Tuppen, Enterprise chief executive, said: “We are very pleased to announce the signing of our Forward Start Facility, which reinforces the support of our banking group and demonstrates the proactive steps we have taken to address the financing plans for the business.
“The successful signing of this facility allows us to focus on further improving the operational performance of the business and delivering long term value to our shareholders.”
