Maccaferri crisis, here are the details of Carlyle’s rescue proposal. Seci towards 4% of Officine Maccaferri. Negotiation still open

Carlyle and co-investors want to quickly close the Maccaferri operation, after months of work. So on 2 March Carlyle has sent a new draft rescue proposal to If there (the holding company through which the Maccaferri family controls the homonymous Group), Samp is Officine Maccaferri (both belonging to the Maccaferri Group), draft on which however some changes would have already been made yesterday.

BeBeez he had the opportunity to read the draft of March 2, which integrates a previous proposal sent on February 21 last. In the letter of March 2, Carlyle gave Seci only time until yesterday, March 4th, to answer and this because it was imagined that just yesterday the Seci board of directors would have deliberated on the concordat plan to be presented to the Court of Bologna. In fact, according to what appears to be BeBeez, the Seci’s board has decided that it will meet to deliberate on the issue only in the next few days. The holding plan will in fact be the last to be developed and priority will be given to the other companies in the Concordat of the Maccaferri Group. In any case, Carlyle in the letter also asked that Seci guarantee that it will present to the Court of Bologna by March 15, the request for approval of Officine Maccaferri’s debt restructuring agreement.

Recall that last February 13 the Public Prosecutor’s Office submitted to Court of Bologna bankruptcy petition ex article 162 of the Bankruptcy law for Seci (see here another article by BeBeez). The Tribunal has accepted the application and set for the next April 3 hearing to hear the company and the recurring creditors about the assessment of the conditions for filing for bankruptcy. The Prosecutor believes that the company is in a “real irreversible state of insolvency“, With a negative shareholders’ equity of over 65 million euros at 31 December 2018, worsening at around -120 million as at 30 September 2019. The bankruptcy petition is a due act of the Public Prosecutor’s Office, considering that Seci has not respected the deadline of January 2020 for the presentation of the plan. The bankruptcy process will cease when the company presents the recovery plan. According to what appears to be BeBeez, the holding company could present the composition plan reasonably around the middle of March.

Last February, Officine Maccaferri had reached a so-called forbearance agreement (i.e. containing concession measures) with a group of bondholders representing 54% of the overall value of the 190 million euro bond listed on theExtraMot Pro, with 5.75% coupon, expiring in 2021 (see other article by BeBeez). That group, reads the letter of February 21, includes Carlyle and its co-investors GLG is Stellex Capital Management (together AHG). At the end of January 2020, Carlyle had written a letter to the Maccaferri Group stating that the bond regulation provides that enforcement of the guarantees will be activated automatically. To avert the acceleration and therefore the signing of an agreement, the US fund had offered the write-off of the existing debt (excluding the bank debt) of Officine Maccaferri and, within a larger plan, new finance for Officine Maccaferri and for Seci (see other article by BeBeez).

Carlyle’s proposal, detailed in the letter of February 21 and referred to in that of March 2, provides for Seci:

1. disbursement of new finance through a bridge loan from 10 million euros at maturity 18 months, in the form of a super senior minibond listed on the Third Market of the Vienna Stock Exchange or in the form of a supersenior loan granted by an SPV; in any case, the bond or loan, which will have a maturity of at least 18 months and will pay an 8% coupon (plus a 5% coupon in the event of default), will be fully subscribed by Carlyle and any of its co-investors;
2. the repayment of the loan referred to above upon approval of the composition with the disbursement of a super senior post restructuring financing also for 10 million, in the form of a minibond listed on the Third Market of the Vienna Stock Exchange, with a maturity of 4 years and a coupon of 12.5% ​​per year and a default interest of 5%; also in this case the bond will be fully subscribed by Carlyle and any of its co-investors;
3. both loans will be guaranteed by Seci RE, as well as: by the pledge request on Seci shares in Officine Maccaferri, Finim spa, Esa srl, Fortune 5 srl, Seci RE, Sabina spa Industrial Park; from the mortgage on Villa Maccaferri and on Exfap Parco Corese, headed by Seci; from dividends of Manifatture Sigaro Toscano.

The structure of the plan is similar for Samp, but the bridging loan, in the form of a supersenior minibond listed on the Vienna Stock Exchange, may rise up to 25 million euros, at an interest rate of 10% and a default interest of 5% per year. Of this value, at least 12.5 million will be disbursed by Muzinich and the rest from Carlyle. The loan must be repaid to the approval, when another of the same amount will be disbursed in the form of super senior post restructuring financing, with a cash coupon of 8% plus a PIYK interest (payment in kind, i.e. capitalization of the coupons at maturity ) of 5.25% per year. Also in this case the loan will be half-subscribed between Carlyle and Muzinich.

Finally, in the case of Officine Maccaferri, the disbursement for the loan will be greater and equal to 60 million euros, always in the form of a supersenior minibond listed on the Third Market in Vienna, to be repaid to the approval of the Debt Restructuring Agreement, with an interest rate of 8% and a default rate of 5%. The disbursement of a new super senior post restructuring financing of equal value and always in the form of a minibond listed in Vienna will follow, with a 6.5% coupon and a 6.5% PIYK interest. Of the total bonds, 30 million euros can be converted at any time into Officine Maccaferri shares equal to 83% of the share capital of the post-restructuring company. Both bonds will be underwritten by AHG (acronym for Ad Hoc Group)i.e. Carlyle and her co-investors (GLG is Stellex Capital Management), who can decide at any time whether to convert a loan amount into equity for less than or more than the 30 million indicated.

At the time of approval of Officine Maccaferri’s debt restructuring agreement, the bondholders would end up with 96% of the capital of the company, while Seci would dilute to 4%. While after the conversion of the minibond for 30%, the subscribers would find themselves with 83% of the capital, the bondholders with 13% and Seci always with 4%.

The Maccaferri Group had opened the arrangement with reserve for Seci holding at the beginning of June 2019; for Seci Energia, sub-holding of the energy sector; and for Enerray, company in the energy sector. Subsequently, the construction company also asked for the agreement Sapaba, the sugar producer Sadam and the factoring company Felsinea Factor, for a total of 400 employees involved out of the 4,500 total of the Maccaferri Group (see other article by BeBeez) and Samp, mechanical engineering company (see other article by BeBeez). The plan for Felsinea Factor, which will be liquidated, and for Enerray, whose maintenance business branch has already been leased to Lt Holding (always photovoltaic sector), which is already tied to the purchase. Sapaba, Exergy (sold in October 2019 to the Chinese of NanjingTica Thermal Solution, see other article by BeBeez) is Sebigas continue their path of arrangement.

Recall that other possible saviors of Maccaferri, besides Carlyle, could be Oxy Capital is hPS (see other article by BeBeez) Fortress Investment Group (see other article by BeBeez) is Four R. (see other article by BeBeez), who had submitted bids in 2019. Last February she would have entered the game too Bonfiglioli Riduttori, who would bid on Sampingranaggi, one of the six divisions of Samp agreed in autumn 2019 (see other article by BeBeez).