Baywa Debt Talks To Intensify With Restructuring Report Due
Date
9/23/2024 7:00:24 PM
(MENAFN- Live Mint) (Bloomberg) -- German commodities group BayWa AG is set to circulate the first draft of a restructuring opinion as soon as Monday, according to people with knowledge of the matter, providing the basis for further negotiations over its €5 billion debt load.
shareholders and lenders to BayWa are in discussions over a second round of bridge financing in the region of €200 million ($222 million), according to some of the people, who asked not to be named discussing private information. An extension of a standstill on its debt from Sept. 30 to the end of the year is also under negotiation, they said.
Talks are set to intensify as lenders scrutinize the report, which will provide more detail on the company's liquidity situation. A potential agreement would come on top of a €547 million package agreed in August with main bank lenders and shareholders Bayerische Raiffeisen-Beteiligungs AG and Raiffeisen Agrar Invest AG.
One potential hurdle will be coaxing investors in commercial paper, which mature in the near-term and would otherwise stand to be paid back, to agree to the standstill extension, some of the people said. The company had €632.4 million of a total €1 billion commercial paper program outstanding as of year-end 2023.
BayWa, which has its origins in agricultural trading, has racked up a large debtload after an acquisition spree that now sees its business span construction, renewables and agriculture. The Munich-based firm had been struggling with higher interest rates and volatility in its renewables projects business, before announcing it was facing strains on its liquidity in July.
EIP Stake
While further restructuring of the business is envisaged, so far no formal sales processes have commenced for BayWa units, according to some of the people. Energy Infrastructure Partners, which already owns a 49% stake in renewables unit BayWa Re, is in early discussions to increase its stake in the unit to 80% or even 100%, separate people familiar with the matter said.
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