Ardagh gets €790 million, $250 million secured term loans due 2029

By Mary-Katherine Stinson

Lexington, Ky., April 15 – Ardagh Group announced that unrestricted subsidiary Ardagh Investments Holdings Sarl entered a new senior secured credit facility with some investment funds and other entities managed by affiliates of Apollo Capital Management, LP, according to multiple notices.

The new facility consists of an initial €790 million senior secured term loan, a $250 million (equivalent) senior secured exchange term loan and additional senior secured term loans in an amount sufficient to fund a debt service reserve account at Ardagh Investments. The facilities will mature in 2029.

The facilities are secured on all material assets of Ardagh Investments, including a pledge on equity interests of Ardagh Investments in Ardagh Metal Packaging SA.

Ardagh Investments intends to use about €755 million of the proceeds of the initial term loan to subscribe to new senior secured notes due 2029 issued by Ardagh Packaging Finance plc and Ardagh Holdings USA Inc., which will be used to redeem in full their $700 million senior secured notes due 2025. Following the redemption of the 2025 secured notes, Ardagh will have no bonds maturing before August 2026.

Ardagh Investments is permitted, at its option, to issue exchange loans for senior secured toggle notes due 2027 issued by ARD Finance SA or senior unsecured notes issued by Ardagh Packaging Finance and Ardagh Holdings USA that are held or acquired by one or more Apollo Investors. Each exchange loan will be issued in a principal amount equal to the purchase price paid by the Apollo investors for the exchanged PIK notes and/or the senior unsecured notes, as applicable, plus an agreed premium.

The terms of the notes restrict Ardagh’s ability to pay dividends and other distributions, which will prevent ARD Finance SA from paying cash interest on the toggle notes for all interest periods after June 30.

The facilities are expected to be drawn down in the second quarter of 2024.

As disclosed previously, Ardagh continues to evaluate options with its capital structure and may seek to further reduce its debt through discounted open market purchases, tender offers, exchange offers, privately negotiated transactions or otherwise depending on market conditions.

Ardagh also noted recent developments for some of its subsidiaries.

Revenue for Ardagh’s glass packaging business is expected to be about $1 billion in the first quarter, compared with $1.1 billion in the same period last year. Also in the first quarter, Ardagh Glass Packaging’s adjusted EBITDA is expected to be $115-120 million, compared with $209 million in the same period last year. This is in line with previously published expectations.

Net leverage for Ardagh’s restricted group under its existing bond documentation, the Argid restricted group, as of March 31 is expected to be about 7.5x LTM adjusted EBITDA, including dividends received from Ardagh Metal Packaging, compared to 6.8x as of Dec. 31.

Ardagh Metal Packaging’s results for the first quarter are expected to be in line with previously issued guidance.

Ardagh’s financial advisor is Houlihan Lokey and its legal advisor is Kirkland & Ellis LLP.

Ardagh is a Dublin-based supplier of glass and metal containers.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.