Laurus issues EUR 400 million of new equity and reschedules its bank debt to safeguard the continuity of the company.
Laurus N.V. today announces that together with its principal banks ING Bank, ABN AMRO Bank and Rabobank and the French retail company Casino S.A. it intends to raise, subject to shareholders and works council approval, EUR 400 million of new equity and to reschedule its existing bank debt into a new credit facility of up to a maximum of EUR 910 million.
As reported earlier, the Company realised in 2001 very unsatisfactory results. The conversion started last year of its various supermarket formats in the Netherlands into one single new Konmar format, together with costly back-office integration problems, the heavy capital expenditure needed for the planned store conversions and the heavy losses incurred in Spain during the first half of 2001 led to a serious depletion of the Company?s financial resources. As a consequence the Banks agreed on 7th October 2001 to an extra Standby Facility of ? 100 million and the granting of a subordinated loan of ? 150 million for a period of up to 10th April 2002.
In addition to the above, the Spanish subsidiary continued, contrary to expectations, to incur heavy losses in the second half of 2001. A restructuring of the Spanish activities will therefore be much more costly than anticipated. Divestment of the Spanish subsidiary is under present conditions not realistic.
At the same time, the indebtedness of Laurus sharply increased as a result of the negative operational cashflows, lower than previously expected divestiture proceeds and increased working capital requirements.
To safeguard the continuity of the Company and to maintain the confidence of its suppliers and credit providers, the Company and its Banks have come to the conclusion that this can only be achieved in association with a partner who is willing to devote significant financial and human resources to a turnaround of the Company and its subsidiaries.
The Supervisory Board and the Management Board of Laurus as well as its Banks greatly welcome Casino as a major shareholder which will pave the way for a turnaround of the Company in the interest of all its stakeholders.
For further details please visit www.laurus.nl.