Information on the refinancing of Group
Current report No. 10/2020
Legal basis: art. 17 MAR
Title: Information on the refinancing of Group
The Board of Directors of Allegro.eu (the "Company") hereby informs that today it completed the refinancing of its existing borrowings with funds drawn from new borrowing facilities together with part of the proceeds from primary share issuance made in connection with its initial public offering as fully described below:
I) Following a Board of Directors decision to refinance the Company and its subsidiaries (the “Group”) on the terms available accepted on 11 September 2020 and confirmed on 28 September 2020, on 29 September 2020 an agreement was signed between Adinan Midco S.à r.l. (the "Credit Facility Borrower") and the following lenders (jointly, the “Lenders”): Bank Handlowy w Warszawie S.A., Bank of America Merrill Lynch International Designated Activity Company, Bank Polska Kasa Opieki S. A., Barclays Bank PLC, Credit Agricole Corporate and Investment Bank, Credit Agricole Bank Polska S.A., Erste Group Bank AG, Goldman Sachs Bank USA, Industrial and Commercial Bank Of China (Europe) S.A. oddział w Polsce, Morgan Stanley Bank International Limited, Morgan Stanley Senior Funding, Inc., Kasa Oszczędności Bank Polski S.A.,Powszechny Zakład Ubezpieczeń S.A., Powszechny Zakład Ubezpieczeń Na Życie S.A., PZU Fundusz Inwestycyjny Zamknięty Aktywów Niepublicznych BIS 1, Raiffeisen Bank International AG and Santander Bank Polska S.A (the "New Facilities Agreement") resulting in commitments for (i) a PLN 5,500.0 million senior secured term loan facility (the "New Senior Facility") and (ii) a PLN 500.0 million (equivalent) multi-currency revolving credit facility ("New RCF" and together with the New Senior Facility, the "New Facilities").
The final maturity date for the New Senior Facility is October 2025 and the final maturity date for the New RCF is October 2025 (subject to two 12 month extensions at the request of the Company or Credit Facility Borrower and with the consent of the relevant New RCF Lender(s)). There are no repayments due on the New Senior Facility prior to the final due date on 14 October 2025.
The New Facilities will initially bear interest at a rate per annum equal to WIBOR (or EURIBOR or LIBOR, as applicable at the Credit Facility Borrower’s option) (in each case subject to a zero floor) and an initial margin of: (i) in relation to New Senior Facility, of 2.25% per annum and (ii) in relation to the New RCF, of 1.80% per annum.
The New Facilities under the New Facilities Agreement shall be secured by a security package established in favor of the Lenders, consisting of (i) a Luxembourg law governed share pledge over the shares in the Credit Facility Borrower, (ii) a Polish law civil and registered share pledge over the shares in the Company's indirect subsidiaries: Allegro.pl sp. z o.o. ("Allegro.pl") and Ceneo.pl sp. z o.o. ("Ceneo.pl"), (iii) a Polish law registered pledge to be granted by Allegro.pl and Ceneo.pl over key trademarks owned by Allegro.pl or Ceneo.pl, together with a Polish law power of attorney in respect of the Allegro.pl and Ceneo.pl key web domains and (iv) a Polish law submission to enforcement by each of Allegro.pl, Ceneo.pl and the Credit Facility Borrower.
II) As a result of the decision to refinance the senior term and revolving facilities agreement as well as the second lien facility agreement (together the “Original Facilities”) each originally dated 20 December 2016, the Group expects to recognize a non-cash charge to financial expenses in its financial statements for the third quarter of 2020 in the amount of approximately PLN 144.2 million. This amount reflects the unamortized value of origination costs and related expenses, incurred at origination of the Original Facilities in 2017 and as a result of their upsize in 2019, which will no longer be amortized over the full term of the Original Facilities. In addition, the early repayment of the Second Lien Facility triggers a liability to pay PLN 26.0 million in early payment fees which is also expected to be accrued to financial expenses in the third quarter of 2020.
III) On 14 October 2020 the Credit Facility Borrower completed its refinancing transaction (“Refinancing Transaction”) by drawing the full amount of borrowings under the New Senior Facility, receiving a net amount of PLN 5,440.0 million after deduction of PLN 60.0 million arrangement fees and expenses, and, together with the Company utilising its net proceeds from the initial public offering of the Company’s shares of PLN 900.5 million PLN, applied the available funds to the repayment and discharge in full of all indebtedness outstanding under Original Facilities in the amount of PLN 6,151.7 million.
IV) As a result of the Group completing the Refinancing Transaction, the balance of outstanding bank borrowings fell by PLN 651.7 million from PLN 6,151.7 million to PLN 5,500 million.
Allegro.eu is a Luxembourg public limited liability company (société anonyme), registered office: 1, rue Hildegard von Bingen, L – 1282 Luxembourg, Grand Duchy of Luxembourg, R.C.S. Luxembourg: B214830.