Atalian Global Services

Group of Atalian Creditors Hire Weil as Company Explores Refi Options

Thu 06/22/2023 13:06 PM
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A group of creditors to French facility management services provider Atalian has hired legal advisors from Weil as the company explores refinancing options, sources told Reorg.

The company has €625 million of notes coming due in May 2024 followed by €350 million and £225 million due in May 2025.

The company said on its first-quarter earnings call that it expects to complete a refinancing by Feb. 28, 2024. Management said that it plans to get back to investors at the end of September or the beginning of October this year with a clear and complete plan for a new strategy and refinancing.

The company is working with Messier Maris & Associes and White & Case on refinancing options, as reported.

Atalian repaid its RCF using some of the €753 million proceeds from the sale of its U.K., Ireland and Asia activities to CD&R in December last year.

That sale raised about €698 million in cash for Atalian, with the remaining €55 million paid in the form of a two-year vendor loan note. Atalian also said it would use proceeds to deleverage the company and its subsidiaries, in particular paying off part of the 2024 notes.

The company’s capital structure, pro forma as of April 30, is below:





















































































































































Atalian Global Services - Pro Forma as of 04/30/2023

03/31/2023
EBITDA Multiple

(EUR in Millions)
Amount
Maturity
Rate
Book


€103M RCF due 2023 1
-
Apr-22-2023
EURIBOR + 2.250%

Total Secured Debt
-

€625M 4% Senior Notes due 2024 2
625.0
May-15-2024
4.000%

€350M 5.125% Senior Notes due 2025
350.0
May-15-2025
5.125%

£225M 6.625% Senior Notes due 2025 3
255.6
May-15-2025
6.625%

Total Senior Debt
1,230.6
15.8x

Other Debt 4
15.1


Total Other Debt
15.1
16.0x

Lease Liabilities
98.3


Total Leases
98.3
17.2x

Total Debt
1,344.0
17.2x

Less: Cash and Equivalents
(616.5)

Net Debt
727.5
9.3x

Operating Metrics

LTM Reported EBITDA
78.0


Liquidity

Plus: Cash and Equivalents
616.5

Total Liquidity
616.5

Credit Metrics

Gross Leverage
17.2x

Net Leverage
9.3x


Notes:
The capital structure is on a IFRS basis. Cash position is pro forma for the €63M repayment of RCF in April. Total liquidity excludes headroom under the non-recourse factoring agreement.
1. Pro forma for the full repayment in April 2023.
2. Management confirmed that these notes will be partially redeemed upon the closing of the acquisition of Atalian's United Kingdom, Ireland and Asia operations by CD&R.
3. Converted to EUR based on GBP/EUR rate of 1.13587 effective as of March 31, 2023.
4. Calculated as €1,407B total gross debt as reported less other items in the capital structure.
Pro Forma: The capital structure is pro forma for the full repayment in April of the remaining €63M outstanding RCF as of March 31, 2023.



Last month, Moody’s downgraded Atalian’s corporate family rating to Caa2 from Caa1 and its probability of default rating to Caa3-PD from Caa1-PD, with a negative outlook. The downgrade came amid uncertainties about the full repayment of Atalian's debt maturities in 2024 and 2025, coupled with weak liquidity.

– Andrew Ross, Aurelia Seidlhofer
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