Marston's launches Covid-19 consent solicitation for three series

By Taylor Fox

New York, Nov. 12 – Marston’s Issuer plc announced a consent solicitation regarding its £214 million of class A2 secured fixed/floating rate notes due 2027 (ISIN: XS0226790748), its £200 million of class A3 secured fixed/floating rate notes due 2032 (ISIN: XS0226792280) and its £250 million of class A4 secured floating rate notes due 2031 (ISIN: XS0331071026), according to a company announcement.

The consent solicitation is being launched in order to seek the approval of noteholders to further waivers and a further amendment in respect of certain provisions in the financing.

The need for these further waivers and the amendment has arisen directly as a result of the second forced closure of pubs, restaurants and other hospitality venues in England for the period from Nov. 5 until at least Dec. 2 by order of the government as a result of the Covid-19 pandemic.

As previously reported, equivalent waivers and amendment were approved by noteholders in May 2020 in connection with the first lockdown.

As a result of the second lockdown, Marston’s expects that the debt service covenant could be breached on the forthcoming financial quarter dates falling on Jan. 2, 2021 and April 3, 2021.

Based on the current intentions expressed by the British government that pubs and restaurants in England will be forced to remain closed until Dec. 2 and based on the assumption that once they are allowed to reopen and can operate from the beginning of December, Marston’s expects its two financial quarter debt service covenants for the relevant periods will drop to around 1.27x and 1.01x respectively, and then return to above the required covenant level of 1.10x for the period ending on July 3, 2021 and its four financial quarter debt service covenants for the relevant years ending on Jan. 2, 2021 and April 3, 2021 will drop to around 0.95x and 1.01x respectively,

and then return to above the required covenant level of 1.10:1.00 for the year ending on July 3, 2021 and thereafter.

A meeting of noteholders to consider and pass the extraordinary resolution to approve the proposals will take place at 5 a.m. ET on Dec. 3 by audio or video call.

Holders who give consent prior to the early instruction deadline of 11 a.m. ET on Nov. 27 with receive the early instruction fee equal to 0.05% of the principal amount outstanding of the notes.

The consent solicitation will expire at 5 a.m. ET on Dec. 1.

Payment of the early instruction fee, if the consent conditions are satisfied, will be made on or about Dec. 10.

D.F. King Ltd. (+44 0 20 7920 9700; marstons@dfkingltd.com, https://sites.dfkingltd.com/marstons) is the information and tabulation agent.

The pub operator and independent brewer is based in Wolverhampton, England.

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