Lauritz.com negotiates potential sales; seeks bondholder approval

Chicago, April 8 – Lauritz.com Group A/S is in negotiations regarding a full sale of all the shares in Lauritz.com A/S or a carve-out sale of its subsidiaries in Sweden, Germany and Finland to an industrial purchaser. Both transactions will need approval from the holders of its senior secured bonds with ISIN SE0005999521, according to a press release.

The full sale would include the requirement that the whole bond debt will be repaid by Lauritz.com A/S. It is expected that 80% of the principal, SEK 160 million, would be repaid in cash and the other 20% of the principal amount, or SEK 40 million, would be written off.

Bondholder approval would be necessary for that scenario.

The accrued interest on the bond debt of SEK 16.3 million would be repaid in full.

Additionally, the company’s super senior loan would also be fully repaid including interest for SEK 20.6 million.

In a full sale it can be expected that Lauritz.com Group A/S would be liquidated in due course.

For a carve-out sale, there would be a partial repayment of Lauritz.com’s outstanding SEK 200 million bond debt.

In this scenario, a repayment of SEK 45 million of the bond debt would be made, interest of SEK 16.3 million would be paid and the company’s loan mentioned above would be repaid with interest for a total of SEK 20.6 million.

The terms and conditions of the bonds would be amended to support the long-term liquidity position of the company by lowering the interest rate to 4%, deferring interest payments for the period Dec. 17, 2020 to Dec. 17, 2021 which would be paid at maturity and removing the requirement for installments being paid before the final maturity of the bonds. The final maturity date will remain Dec. 17, 2024.

If there is a carve-out sale, the remaining activities of Lauritz.com A/S would continue with the group as the parent company.

The equity of Lauritz.com would become negative by approximately DKK 40 million as the sale would generate an accounting loss.

A notice of written procedure is being sent to the bondholders, requesting the bondholders to approve terms of a full sale and a carve-out sale pertaining to the bond terms.

Approval is a condition for the completion of both the full sale and the carve-out sale.

Both sales would require that at least 2/3 of the voting bond debt vote in favor of the proposal.

A group of bondholders representing a substantial portion, but less than 50% of the total, has confirmed that they will vote in favor of the proposal.

The record date to vote is April 14.

The deadline for the written vote is 9 a.m. ET on April 28.

The decision of whether the full sale or the carve-out sale will be completed will be made by the group of bondholders referred to above, Lauritz.com A/S and majority owners Bengt Sundstrom and Mette Sundstrom in the second half of April based on the terms of the available final deals.

It is expected that either a full sale or a carve-out sale will be signed prior to the end of April and that the relevant deal will be closed prior to the end of May.

Lauritz.com operates online auction services through its trading platform based in Soborg, Denmark.

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