LONDON Feb 9 Creditors to French vehicle
leasing firm Fraikin are hiring debt restructuring advisers
after fellow leasing group Petit Forestier announced last month
that it is no longer able to acquire the company, sources close
to the situation said.
Fraikin, owned by private equity firm CVC Capital Partners,
has hired Rothschild to advise it on a
potential upcoming debt restructuring, while junior mezzanine
holders have hired Lazard, one of the sources said.
Senior debt holders have been holding pitches for a
restructuring adviser with a decision expected to be made within
the next week.
CVC, Rothschild and Lazard declined to comment.
The company has at least €1.4bn of debt, including €900m
remaining on a €1bn five-year securitisation that was signed in
June 2012, a €70m mezzanine bond, €350m senior holdco debt and
an €80m opco bond, the source said.
The failure of the acquisition process came as a surprise to
the market and with March 2017 maturities looming the company is
aiming to get advisers into place as quickly as possible, the
“It took everyone off guard – Fraikin was literally on
no-one's radar,” he said.
According to a second adviser, Fraikin is unlikely to go
through a full blown debt restructuring but instead will result
in an amend and extend process.
Credit Agricole acted as lead arranger and Natixis as
co-lead arranger on the €1bn financing agreed in 2012, which was
backed by long term lease receivables and the residual value of
49,000 trucks in France, UK and Spain managed by Fraikin.
In June last year, Petit Forestier announced it had entered
into an exclusivity agreement with the aim to acquire 100% of
the Fraikin Group’s share capital from by CVC Capital Partners
and Eurazeo, subject to regulatory approval.
The antitrust authorities in Poland and Spain granted their
approval in August and October 2016 respectively, but the
company ultimately did not gain approval from the French
authorities and in January Petit Forestier announced that it had
decided not to go ahead with the deal.
CVC acquired Fraikin in February 2007 in a deal that valued
the company at €1.35bn with the previous majority shareholder
Eurazeo reinvesting €60m alongside CVC.
Since September 2015 the company manages a fleet of 57,000
vehicles, with over 85% of its revenues linked to long term
contracts up to nine years.
(Editing by Christopher Mangham)