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RLPC-Centerbridge mulls options for Apcoa refinancing
April 22, 2014 / 12:10 PM / 4 years ago

RLPC-Centerbridge mulls options for Apcoa refinancing

LONDON, April 22 (Reuters) - Distressed debt investor Centerbridge is looking at ways to refinance debt in struggling German car parking business Apcoa once it completes an imminent debt restructuring that will see it take control of the company, banking sources said.

Centerbridge bought millions of euros of Apcoa’s debt on Europe’s secondary loan market at the end of last year in a bid to gain control of Europe’s biggest parking management firm from private equity house Eurazeo.

In March, a UK judge agreed to change the jurisdiction of Apcoa’s loan documents to the UK to enable an amend and extend (A&E) on its 650 million euros ($897.26 million) of debt using a scheme of arrangement, which only needs consent from 75 percent of lenders.

By using an A&E, Apcoa can extend the upcoming April maturities on its debt giving the company and lenders breathing space to thrash out a full blown financial restructuring that will involve a debt-for-equity swap.

Following that, Centerbridge is considering conducting a refinancing of the restructured debt and is approaching lenders about the idea, which is unusual because typically a company that has been through a debt restructuring will wait for performance to improve before carrying out a refinancing.

“Centerbridge will in effect become like a private equity owner and selling the debt will be like taking a dividend,” a banking source said.

Centerbridge was not immediately available to comment.


A refinancing would face some major hurdles in attracting support from the market given that lenders incurred deep discounts when selling their Apcoa loan exposure to Centerbridge.

A saving grace for the refinancing could be the lack of deals in the market and the desire of cash-rich lender to invest. The deal could also be made more attractive if the debt and equity was stapled together, which would increase lender returns if the company performs well, banking sources said.

“The issue with a lot of these credits is good companies but bad debt structures. You have a lot of banks that automatically shy away from deals where they lost money but more pragmatic banks and investors will be able to assess the company afresh,” a second banking source said.

Apcoa was bought by Eurazeo for 885 million euros in August 2007 from Bahrain’s Investcorp at the peak of the buyout boom, but has struggled to manage its debt burden in a weak growth environment in Europe.

PWC, Linklaters and Clifford Chance are advising the company on the financial restructuring, Lazard and Rothschild are advising Eurazeo. ($1 = 0.7244 Euros) (Editing by Christopher Mangham)

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