Lauritz.com Group A/S – Bond Written Procedure and Potential sale
Copenhagen, 09 April 2021
Lauritz.com Group A/S is in the process of negotiating a sale of either (i) all the shares in Lauritz.com A/S, currently being negotiated as a sale to a newly formed holding company to be owned by a financial purchaser to become majority shareholder and Mette and Bengt Sundström to become substantial minority shareholders (the "Full Sale") or (ii) its subsidiaries in Sweden, Germany and Finland to an industrial purchaser (the "Carve-out Sale"). The Full Sale is being negotiated with one party and the Carve-Out Sale is negotiated with another party. Lauritz.com A/S will initiate a written procedure tomorrow morning in which it seeks approval for both transactions from the holders of its senior secured bonds with ISIN SE0005999521.
The Full Sale would result in a full transfer of the shares in Lauritz.com A/S. Prior to a Full Sale, a general meeting of Lauritz.com Group A/S would be held to enable the shareholders to approve the sale and amend the articles of association to permit the sale. It is expected that the sales price for all shares in Lauritz.com A/S would result in the equity of Lauritz.com Group A/S being equal to or around the quoted market price of the company as of today.
It is a requirement for a Full Sale that the whole bond debt will be repaid by Lauritz.com A/S. It is expected that 80% of the principal amount SEK 160m would be repaid in cash and the remaining 20% of the principal amount SEK 40m would be written off. Thus, the approval of the bondholders of Lauritz.com A/S will be required. Furthermore, the accrued unpaid interest on the bond debt of SEK 16.3m will be repaid in full.
In a Full Sale, the company’s super senior loan would be fully repaid including accrued interest, in total SEK 20.6m.
The expected earnings for the total business remain in line with the earnings guidance for the group for 2021 with an EBITDA of DKK 20-40m. After a Full Sale, Lauritz.com Group A/S would have no remaining business activities, and the balance sheet will primarily consist of liquid assets, tax/VAT payable and equity. In a Full Sale, it can be expected that Lauritz.com Group A/S would be liquidated in due course.
The Carve-out Sale would be a sale of Lauritz.com A/S' subsidiaries in Sweden, Germany and Finland, including AB Stockholms Auktionsverk.
A Carve-out Sale would enable partial repayment of Lauritz.com A/S' outstanding SEK 200m bond debt. In a Carve-out Sale, a repayment of SEK 45m of the bond debt would be made, accrued unpaid interest on the bond debt of SEK 16.3m would be paid and the company’s super senior loan would be fully repaid including accrued interest, in total SEK 20.6m. The terms and conditions of the bonds would be amended to support the long-term liquidity position of Lauritz.com A/S by lowering the interest rate to 4%, deferring interest payments for the period 17 December 2020 to 17 December 2021 which will be paid at maturity of the bonds and removing the requirement for instalments being paid before the final maturity of the bonds. The final maturity date will remain 17 December 2024.