Premier Foods Announces Landmark Re-financing Package
Premier Foods has obtained unanimous consent from its banking syndicate, swap counterparties and pension schemes to the terms of a 4 ½ year re-financing package that will allow the company to execute its new growth strategies. The re-financing package is subject to the formalities of final documents being signed which are expected by the end of March.
Under the terms of the package, banking facilities of £1.2 billion have been extended from December 2013 to June 2016. Covenants have also been re-set to reflect the group’s growth priorities of focusing investment behind eight Power Brands, strengthening its capabilities, reducing costs and divesting selected businesses. The total interest rate swap portfolio, including previously restructured swaps, will be restructured into an additional term loan of approximately £200 million which will have the effect of reducing the group’s interest expense. Additionally, the trustees of the group’s pension schemes have agreed to defer deficit contribution payments until 2014.
Premier Foods expects overall financial results for 2011, both reported and underlying, to be at the lower end of market expectations and that its current focus continues to be to stabilise the business and invest in its recovery and future growth.
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