| LONDON, July 31
LONDON, July 31 French retailer Vivarte received
unanimous lender consent on a restructuring that will see
lenders take the business after agreeing to wipe out 2 billion
euros (2.68 billion US dollar) of debt and inject new money, the
business announced on Thursday.
All 116 lenders have agreed to reduce debt to 800 million
euros from 2.8 billion euros and a new 500 million euro cash
injection. The agreement was submitted to the Commercial Court
of Paris, which will give its decision on Friday.
Oaktree, Alcentra, GoldenTree and Babson will be anchor
shareholders in Vivarte following the restructuring.
The 500 million cash injection will be in the form of a new
super senior term loan that will trade on Europe's secondary
loan market with equity stapled to it, banking sources said.
The new term loan pays an interest margin of around 400
basis points (bps) cash and 700 bps payment-in-kind. It also has
non-call two, which means it cannot be refinanced or repaid
within two years, one of the bankers added.
The new term loan was quoted at around 107 percent of face
value on Thursday, according to Thomson Reuters LPC data.
As part of the changes, Vivarte's board will include
shareholders, management and industry experts.
Private equity firm Charterhouse, bought Vivarte in 2007,
backed by 3.43 billion euros of leveraged loans, but struggled
to manage its debt in an unfavourable economic and consumer
environment in France.
Vivarte entered into a four-month conciliation process with
its lenders in March to negotiate a way forward after failing to
get an agreement from a majority of its lenders to suspend loan
covenant tests. It reached an agreement with 12 lenders on the
financial restructuring in June, which was then put to the rest
of the lenders. [ID: nL6N0OL3XI]
(1 US dollar = 0.7472 euro)
(Editing by Christopher Mangham)