Hagemeyer restructuring
ABN AMRO and Lehman Brothers advised Hagemeyer
Rescuing the distressed Hagemeyer company, a global business-to-business distribution company for electrical materials and safety products, was complicated by its complex capital structure, featuring multiple loans, multiple jurisdictions and different structures, covenants, guarantors and other conditions.
Overcoming this complexity while ensuring the continuity of the company was the notable feature. The restructuring guaranteed refinancing proceeds of about €1.5bn, providing certainty of funds. This was achieved through a €460m rights issues, a €150m convertible bond offering and a €905m syndicated credit facility.
Evidence of the complexity: the restructuring took place during a covenant holiday of four types of debt and more than 30 lenders with different conditions and different recourse structures. In a show of confidence, the rights issue’s conversion rate was 90%, despite a bulky seven-for-two offer in combination with the convertible bond offering, at a time when the stock had been in steady decline.
