EQS-News: Adler Group S.A. / Key word(s): Capital Reorganisation
Adler reaches agreement with bondholder group on amendment of note terms and provision of secured debt financing
Luxembourg, 25 November 2022 - Following extensive negotiations with a group of bondholders and their legal and financial advisors, Adler Group S.A. (“Adler Group”) as well as its subsidiaries, ADLER Real Estate AG (“ADLER RE”) and Consus Real Estate AG (“Consus” and together with ADLER RE and Adler Group, the “Adler group of companies”), have today entered into an agreement (the “Lock-Up Agreement”) with the members of the Steering Committee of an ad-hoc group of holders of its Notes (the “Bondholders”) supporting the stabilization of the Adler group of companies to effect an amendment of the terms and conditions of the Notes. The 2023 convertible notes of Adler Group are not subject to the agreement.
Concurrently with the conclusion of the Lock-Up Agreement, the Adler Group has also entered into a commitment letter (the “Commitment Letter”) with the members of the Steering Committee, in which they commit to provide the Adler group of companies with up to EUR 937.5 million of new funding to stabilize the Adler group of companies (the “New Funding”). The provision of the New Funding is subject to a positive restructuring opinion, an amendment of the bond terms and conditions, the provision of the agreed collateral and other customary conditions. Other bondholders will also be given the opportunity to participate in the New Funding, which will be raised in the form of bonds to be subscribed for by the participating bondholders, with the relevant bond proceeds to be on-lent to Adler Group and certain of its subsidiaries.
Adler Group is appreciative of the efforts of the Steering Committee in enabling this important milestone to be achieved.
“In the past few months, we have had very intensive and constructive talks with our bondholders, in always fair negotiations and characterized by mutual respect. My colleagues and I are very grateful for this and above all for the result,” says Thierry Beaudemoulin, Member of the Board of Directors and CEO of the Adler Group.
Adler Group has been advised by PJT Partners as financial and White & Case LLP as legal advisor. The Steering Committee has been advised by Houlihan Lokey as financial and Hengeler Mueller as legal advisor.
Lock-Up Agreement and proposed changes to the Notes
Under the terms of the Lock-Up Agreement and subject to certain conditions, Adler Group has agreed to commence a consent solicitation and, if necessary, alternative implementation proceedings to amend the terms and conditions of the Notes.
The Lock-Up Agreement includes, among other things, the following undertaking of the Bondholders:
Other bondholders that intend to support the implementation proceedings can accede to the Lock-Up Agreement. The proposed changes to the Notes include in particular:
Under the terms of the Commitment Letter, certain Bondholders have committed to provide up to EUR 937.5 million senior secured loans subject to a positive restructuring opinion, an amendment of the bond terms and conditions, the provision of the agreed collateral and other customary conditions. Key terms of the Commitment Letter include:
The maturity of the loan granted by ADLER RE to the Adler Group will be extended to 25 April 2023 and it will be secured in line with customary market practice. The interest rate will be increased.
ADLER RE has also undertaken to seek to amend the terms and conditions of its bonds falling due in 2024 and 2026, respectively to allow such bonds and the payment-in-kind accruing on the New Funding which is passed on to ADLER RE in connection with the Commitment Letter to be secured.
Stefan Kirsten: "Stabilization of the Adler group of companies offers secure perspective"
“The Adler group of companies are caught in a perfect storm, but we managed. In view of the negative developments on the capital and real estate markets in recent months and partly because of our self-induced crisis of confidence, this negotiation result was not an easy undertaking. I am grateful that over the last months our management, with excellent advisor help, has managed to stabilize the group through the transaction with the core of our bondholders. That is another big step forward to give Adler a future. I am confident that we can also successfully take the remaining actions and offer the Adler group of companies and its stakeholders, above all customers and employees, a secure perspective,” says Prof. Dr. A. Stefan Kirsten, Chairman of the Board of Directors of Adler Group S.A.
In the near future, Adler Group will strengthen its Senior Management with a Chief Restructuring Officer. Additionally, Adler Group intends to propose, and recommend to its shareholders, the increase of its Board of Directors by one additional non-executive director with extensive financial expertise to support the financial stabilization process.
Adler Group will shortly launch a consent solicitation process to effect certain amendments to the terms and conditions of the Notes. Related announcements will be provided to bondholders in due course. Adler Group intends that the changes to the terms and conditions of Adler Group’s senior unsecured notes take effect during the first quarter of 2023, subject to bondholder consent.
Adler Group has made available a cleansing presentation which includes a financial update and additional information on its website:
Institutional investors may contact PJT Partners (Attention Tom Campbell, Jamie Bolden, Jakob Schrandt Email: email@example.com) as soon as possible, financial advisor to Adler Group, Houlihan Lokey (ProjectJupiterHL2022@hl.com), or the Calculation Agent (Kroll Issuer Services Limited, Attention: Paul Kamminga, Arlind Bytyqi, Email: firstname.lastname@example.org, Website: https://deals.is.kroll.com/adler).
Contact for media:
T +352 278 456 710
F +352 203 015 00
25.11.2022 CET/CEST Dissemination of a Corporate News, transmitted by EQS News - a service of EQS Group AG.
Adler Group S.A.
55 Allée Scheffer
+352 278 456 710
+352 203 015 00
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