Article/Intelligence
Covenant Analysis: Reorg Estimates €572M-€1.8B Investments Capacity Under Casino HY Bonds, Unlikely to Permit Drop-Down Deal for Teract Merger; Consent of HY Bondholders, Lenders Probably Required
Editor’s Note: In a previous version of this story the available restricted payments and permitted investments capacities were over-estimated by €200 million due to carrying over the general restricted payments basket which cannot be rolled forward. As a result the available capacity has been revised lower to €572 million. Our overall analysis has not changed, but the article below has been amended to reflect the impact of this reduction. Relevant Documents: Casino – Teract merger Casino Senior Secured Notes due 2024 Casino Senior Notes Due 2026 Casino Senior Notes Due 2027 €900M Bonds due 2024 under December 2013 EMTN Bond Prospectus €650M Bonds due 2025 under December 2014 EMTN Bond Prospectus €900M Bonds due 2026 under December 2013 EMTN Bond Prospectus On March 10, Casino Guichard-Perrachon SA said it has entered into exclusive negotiations with Teract, a French medium-sized retail group, aimed at merging their respective French food retail businesses to create a French leader in responsible and sustainable retail activities (Casino-Teract Merger). The transaction contemplates the contribution of more than 9,100 of Casino’s stores to a new entity (MergerCo). The discussions are based on a valuation split of 85% /15% for the assets contributed by each party, on a[...]