PRESS RELEASE:INSIDE INFORMATION / REGULATED INFORMATION
AGREEMENT REGARDING RECAPITALIZATION OF OPERATING SUBSIDIARIES BY SECURED CREDITORS AND WIND DOWN OF LISTED HOLDING COMPANY
- The Company’s Secured Creditors (being its First Lien Creditors and Bondholders, as defined below) will take ownership of the
Biocartis operating subsidiaries through enforcement and injectEUR 40 million of new equity capital to fund the business to EBITDA break-even by the end of 2024 - Under the ownership of the Secured Creditors, the business will have a right-sized balance sheet with
EUR 132 million of deleveraging from today - Transaction should be completed by end of 2023 and is not expected to impact
Biocartis's customers, suppliers, partners or employees - Shareholders of
Biocartis Group NV will receive no distribution from the security enforcement and are expected to receive nothing at the time of its wind down - Unsecured 4.00% convertible bonds due 2027 will be written down to zero pursuant to their terms as part of the enforcement
Main features of the Transaction: The Transaction will provide for the following:
- The Company’s
EUR 116 million 4.5% Second Ranking Secured Convertible Bonds due 2026 (ISIN BE6338582206) (the “Bonds”, and the holders of the Bonds, the “Bondholders”) will be fully equitized into New Biocartis (as defined below) and the Bondholders will become the primary owners of Biocartis’s operating business through their shareholding in New Biocartis. A new entity will be incorporated (“NewBiocartis ”), owned by the Secured Creditors, to which substantially all the Company’s assets will be transferred upon an anticipated security enforcement by the Secured Creditors over the Company’s assets that were pledged to such creditors. - The Bondholders will recapitalize New Biocartis (and its operating subsidiaries) with
EUR 40 million of equity capital, backstopped by a group of supporting Bondholders (the “Equity Injection”). - Lenders under the Company’s first lien convertible term loan facility (the “First Lien Creditors”) have agreed to roll over their first lien debt into New Biocartis (or its wholly owned subsidiaries) and release claims against
Biocartis Group NV . KBC have agreed to extend their financing toBiocartis NV andBiocartis US Inc. - Shareholders of
Biocartis Group NV will receive no distribution from the security enforcement and are expected to receive nothing at the time of its wind down. - The interests and claims of the
EUR 16 million unsecured 4.00% convertible bonds due 2027 (ISIN BE0002651322) (the "Unsecured 2027 Bonds") will be written down to zero pursuant to their terms as part of the enforcement. - Following the full equitization of
EUR 116 million of Bonds, the write down ofEUR 16 million of Unsecured 2027 Bonds, and the closing of the Equity Injection, New Biocartis will have less thanEUR 45 million of gross debt and net debt of approximately zero, allowing it to continue the operations of theBiocartis group.
The Transaction is pursuant to the consent of all First Lien Creditors and more than 75% of Bondholders. To date, 100% of the First Lien Creditors and more than 90% of the Bondholders have delivered support letters with respect to the Transaction.
Trade creditors of
The Transaction is expected to be completed by the end of the year, subject to receipt of certain regulatory approvals.
Following enforcement,
Shareholders of
Security Enforcement Steps by the Secured Creditors: The Transaction will be implemented through a security enforcement by the Secured Creditors, pursuant to which the Secured Creditors will incorporate the New Biocartis entity to be the new, unlisted holding company for Biocartis’s operating subsidiaries. New
Bondholders consent: More than 90% of the Bondholders have already provided binding support letters, which is sufficient to effect the Transaction by way of a written resolution pursuant to the terms of the Bonds. Those supporting Bondholders will receive a consent fee of 250bps (paid 50bps in cash and 200bps in equity in New Biocartis, together the "Consent Fee") and an “early bird” fee from New Biocartis at completion of the Transaction. Any Bondholders who have not yet consented will have until
First Lien Creditors: First lien obligations under the Company’s first lien convertible term loan facility (the “Existing First Lien Facility”) will be rolled over (on a cashless basis) into a new 3-year non-convertible term loan extended to New Biocartis at par (the “New First Lien Facility”) at completion of the Transaction. In connection with their consent to the Transaction, the First Lien Creditors will receive, at completion of the Transaction, certain fees from New Biocartis payable in kind, in equity of New Biocartis and equity warrants in New Biocartis. The interest rate of the New First Lien Facility will remain unchanged. The New First Lien Facility is callable at 103/101/par in years 1, 2, and 3, respectively. All other terms and conditions (including the scope of security) will be substantially the same as in the Existing First Lien Facility, including the
KBC debt: Other debt owed to KBC (approximately
Unsecured creditors and shareholders: Following enforcement,
Equity Injection through New Biocartis: Immediately following the security enforcement and equitization of the Bonds into shares of New Biocartis, the shareholders of New Biocartis (the current Bondholders) will make the Equity Injection of not less than
Backstop and Commitments: The Equity Injection is fully backstopped by a group of supporting Bondholders to ensure certainty of funding New Biocartis going forward. The backstopping parties will receive a fee from New Biocartis, payable in equity of New Biocartis, for their backstop commitment, as will other bondholders who have already committed to participate in the Equity Injection.
New
New
Advisers: DC Advisory and
Further implementation: The Transaction is subject to finalizing additional contractual agreements and the receipt of certain regulatory approvals. The Company intends to reach out to remaining Bondholders who have not yet consented to the Transaction. In the event that the Transaction does not complete in full and/or on time, the
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More information:
e-mail ir@biocartis.com
tel +32 15 631 729
@Biocartis_ www.linkedin.com/Biocartis
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Forward-looking statements
Certain statements, beliefs and opinions in this press release are forward-looking, which reflect the Company's or, as appropriate, the Company directors' or managements' current expectations and projections concerning future events such as the Company's results of operations, financial condition, liquidity, performance, prospects, growth, strategies, the industry in which the Company operates, the timing and effect of the Transaction, and the satisfaction of the conditions to the Transaction. By their nature, forward-looking statements involve a number of risks, uncertainties, assumptions and other factors that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties, assumptions and factors could adversely affect the outcome and financial effects of the plans and events described herein. A multitude of factors including, but not limited to, changes in demand, competition and technology, can cause actual events, performance or results to differ significantly from any anticipated development. Forward-looking statements contained in this press release regarding past trends or activities are not guarantees of future performance and should not be taken as a representation that such trends or activities will continue in the future. In addition, even if actual results or developments are consistent with the forward-looking statements contained in this press release, those results or developments may not be indicative of results or developments in future periods. No representations and warranties are made as to the accuracy or fairness of such forward-looking statements. As a result, the Company expressly disclaims any obligation or undertaking to release any updates or revisions to any forward-looking statements in this press release as a result of any change in expectations or any change in events, conditions, assumptions or circumstances on which these forward-looking statements are based, except if specifically required to do so by law or regulation. Neither the Company nor its advisers or representatives nor any of its subsidiary undertakings or any such person's officers or employees guarantees that the assumptions underlying such forward-looking statements are free from errors nor does either accept any responsibility for the future accuracy of the forward-looking statements contained in this press release or the actual occurrence of the forecasted developments. You should not place undue reliance on forward-looking statements, which speak only as of the date of this press release.
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