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RLPC-Britain's NCP gets debt restructuring green light
April 20, 2012 / 3:30 PM / 5 years ago

RLPC-Britain's NCP gets debt restructuring green light

* Court to validate move on April 27

* Around 77% debt writedown for 15% equity

By Claire Ruckin

LONDON, April 20 (Reuters) - Lenders to Britain’s National Car Parks have agreed to a restructuring of its 650-million pound ($1.04 billion) debt pile, bankers said on Friday.

The company obtained more than 75 percent of lender approval this week, and is set to appear in the High Court on April 27 to receive final validation for the restructuring, bankers said.

Lenders will write down around 500 million pounds of debt in return for a 15 percent stake in the business. Existing owner Macquarie will inject 50 million pounds of new money into NCP, the bankers added.

Macquarie acquired the car parks operator from 3i for $1.5 billion in 2007, backed by 500 million pounds in primary loans and additional debt in swap costs.

NCP has suffered as consumers have tightened their belts in the economic gloom.

A restructuring was dependent on it obtaining approval for a rent reduction from its main landlord, Israeli investment group Delek, which controls 59 percent of the 127 car parks leased to NCP through Powerfocal, the property arm (PropCo) of NCP.

Delek agreed to lower rent by 9 million pounds to 40 million a year as part of the restructuring.

An opco/propco structure, as it is commonly referred to, sees the propco’s debt serviced with rent payments from the opco (operating company). It is the same model under which care homes operator So u thern Cross fell down after defaulting on its debt.

Delek’s bondholders are threatening to put it into insolvency for not servicing debt after Delek did not receive the necessary rent payments from NCP.

In addition, one of Delek’s banks, Hapoalim, called in a 50 million Israeli Shekel ($13.3 million) loan this week, banking sources said.

If bondholders put Delek into insolvency it is unlikely to affect NCP because an administrator will sell off the car parks subject to the new rental terms, lawyers and bankers said.

NCP declined to comment. Delek was not immediately reachable for comment.

NCP’s debt has fallen to deeply distressed levels in Europe’s secondary loan market and is quoted at around 12.6 percent of face value, a dramatic fall from last October when it was quoted at 60 percent, according to Thomson Reuters LPC data.

Delek is being advised by Ernst & Young and U.S. law firm Sullivan & Cromwell. NCP is being advised by Deloitte & Touche and law firm Freshfields Bruckhaus Deringer.

NCP’s lenders -- which include National Australia Bank , Japan’s Mizuho, Royal Bank of Canada and Lloyds Banking Group -- are being advised by KPMG and law firm Linklaters.

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