No. 1/2019
Copenhagen, 06 February 2019
During 2018, Lauritz.com has been examining different options in respect of refinancing Lauritz.com A/S' corporate bonds with ISIN: SE0005999521 issued in 2014 and due to be redeemed in June 2019 at the end of a 5 year term (the "Bonds").
We have now succeeded in defining a firm proposal for amendments to the terms and conditions of the Bonds leading to a restructuring of the Bonds. The proposal includes an extension of the term as well as a reduction of the aggregate nominal amount and the interest rate.
Lauritz will today give instructions to Nordic Trustee & Agency AB (publ) ("Nordic Trustee"), being the agent under the Bonds, to initiate a written procedure in order to request the bondholders to approve the proposal. The proposal has been discussed with and approved by a group of the largest bondholders representing together 48.05% of the Bonds. It is contemplated that Nordic Trustee will dispatch the notice of written procedure to the bondholders on or around 6 February 2019 in accordance with the terms and conditions of the Bonds.
According to the terms of the Bonds, adoption of the proposal requires support from at least 2/3 of the votes submitted by bondholders and that bondholders representing more than 20% of the Bonds participate in the procedure. Since the proposal is already approved by bondholders representing approximately 48.05% of the Bonds, it is our firm belief that the proposal will be approved.
Adoption of the proposal will secure the financial situation for the group of Lauritz.com in the coming years, allowing management to focus on growing and optimizing the business in a market with a considerate further potential.
The proposal can be summarized as follows:
- Write-down of the outstanding aggregate nominal amount by app. SEK 118,000,000 (DKK 86,000,000) from SEK 318,000,000 (DKK 232,000,000) to app. SEK 200,000,000 (DKK 146,000,000).
- Amendment of the interest rate from a floating rate of STIBOR (3 months) + 7.50 per cent. per annum to a blended rate where a nominal amount of approximately SEK 70,000,000 bears a fixed interest rate of 7.5 per cent. per annum and a nominal amount of SEK 130,000,000 bears a fixed interest rate of 4 per cent. per annum. Redemptions will firstly lead to a reduction in the nominal amount that bears the higher interest rate 7.5 per cent. per annum.
- The proposal will reduce the interest for the first 12 months after the adoption of the proposal from approx. SEK 23,900,000 (DKK 17,400,000) (calculated on the basis of the current interest rate) to approx. SEK 10,500,000 (DKK 7,700,000), an interest reduction amounting to SEK 13,400,000 (DKK 9,700,000). In the following years, the interest payments will be reduced further, partly due to the lower outstanding amount following redemptions and partly due to the resulting reductions in the blended interest rate.
- Extension of the final redemption date from 17 June 2019 to 17 December 2024, with scheduled yearly redemptions.
- The provisioning of additional security to secure the Bonds, primarily in form of a pledge in the vineyard Chateau Vignelaure owned by the majority shareholder in Lauritz.com Group A/S, Bengt Sundström. If the proposal is approved, the new bond terms will enter into force when the additional securities have been perfected.
- An obligation of Lauritz.com A/S to pursue divestment of certain auction houses, including establishment of partnership agreements with royalty payments to Lauritz.com. Any cash obtained from such divestments shall be applied as an extraordinary redemption on the Bonds.
- Deletion of the obligation to fulfil the financial covenants, and a waiver of the existing financial covenants for the period until the new terms enters into force.
For further information, we refer to the proposal to the bondholders that will be published on our webpage Lauritz.com and on Stamdata (www.stamdata.com).
Impact on results of the group
The obligation to pursue divestment of certain assets trigger that a test for impairment of these assets must be conducted. This will probably (but not necessarily) result in a negative impact on the result for 2018 compared to previous guidance for 2018 (Ebitda, EBT and Ebitda Margin). The Ebitda Margin excluding sales gains and impairments will be lower than in the latest given guidance and is now excepted to be in the range of 4 - 6 percent, primarily due to increased costs in Q4.
The positive impact on the result due to the write-down of the aggregate nominal amount will be included in 2019.
The bondholders will vote on the proposal to bondholders until the 25th of February. The outcome of the vote will influence certain aspects of the Q4 reporting. Consequently, the Q4 financial report will be published on the 28th of February instead of 21st of February.
Chairman Bengt Sundström, explains:
We are very happy to have reached an agreement with 48.05% of our bondholders. I have no doubts that the proposal will be approved and implemented.
I strongly believe in the future of Lauritz.com. Thus, I have agreed to pledge the vineyard Chateau Vignelaure as security for the restructured bonds.
Lauritz.com are about to launch a number of important commercial initiatives to re-establish the convincing growth path that has been our track history from 1999 until 2017. Since 2017, we have been finding our new ways around a more competitive, but also growing, market of vintage items. In 2018, we have been stabilizing the development of our core business.
As to the coming years, we expect a strong development in the markets for vintage and used items and will apply a progressive and very visible market approach as well as work on developing our pipeline of auction houses interested in partnering up with Lauritz.com into new branches.
Furthermore, we are working intensely on a new state-of-the-art auction platform which will in several areas redefine and expand the perception of the international auction market.
Best regards
Lauritz.com A/S
Bengt Sundström
Chairman
For press enquiries, other questions for and interviews with Bengt Sundström, please contact:
Susanne Sandsberg Klubien
+45 26891909
E-mail press@lauritz.com
Certified advisor: Erik Penser Bank, Stockholm
Market place: Nasdaq First North Stockholm
This information is information that Lauritz.com A/S is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication through the agency of the contact person set out above, at 09.00 am CET on 06 February 2019.
