Smurfit Kappa Group (SKG) has strengthened its capital structure after gaining the consent of lenders to amend to its Senior Credit Facility Agreement.
Deutsche Bank, which is acting as agent for SKG’s lenders, has received consents to the proposed amendments from more than 98 per cent of lenders, which exceeds the 66.6 per cent figure that was the required acceptance level.
The principal requested amendments include extending the maturity of the group’s current €600 mn Revolving Credit Facility (bank overdraft) by one year to 2013; raising longer dated bonds as and when market conditions are attractive; and increasing the existing headroom under leverage and interests cover covenants from Q3 2009 to Q2 2012.
The company says the move will strengthen its capital structure in light of the ongoing uncertainty of the global economic environment, and reflects the recent improvement in credit markets.
Smurfit Kappa Group’s chief financial officer, Mr Ian Curley, says: “We are pleased to have completed the amendments to our Senior Credit Facility within the expected timeframe and costs.
"These initiatives form part of an ongoing process of effective capital management. The proposed amendments provide SKG with significantly enhanced financial flexibility, to focus on delivering industry leading operating performance and maximising free cash flow generation for continued net debt reduction.”
