LSVT refinancing for RedKite
£1m
Over £1m in interest cost savings per annum
£60m
£60m debut private placement, split across three tranches
£20m
£20m deferred monies for 12 months
Background
RedKite signed a syndicated facility in 2012 with expensive margins and LSVT-style covenants.
The aim of the refinancing was to:
- Remove restrictive covenants
- Reduce the cost of funding
- take advantage of the current low long-dated interest levels
- Facilitate a value-enhancing development programme
- Obtain approval to form new group structure
Our role in the process was to advise on the funding strategy, negotiate with lenders and investors and support the decision-making process of the Red Kite’s Board
Our Approach
- Conducted a number of evening sessions for the Board to talk them through the refinancing strategy
- Provided training and negotiation tactics for when Red Kite met with syndicate lenders
- Interviewed potential arranger banks
- Oversaw the pricing and sale of the bonds
- Managed potential risks after pricing
Benefits
- Removal of all LSVT-style restrictions
- Bespoke funding agreement to suit the needs of Red Kite
- £60m Private Placement – with 1-year deferral
- Substantial reduction in the annual interest bill (£1m saving p.a.)
- Negotiated settlement of swap break costs
- New banking facilities – RCF and Term Loan
- Refinanced Syndicate lenders
- Reduced suite of financial covenants
