Abengoa has submitted to the State Industrial Ownership Corporation (SEPI) all the documentation and information required to obtain new financing for a total amount of 249 million euros from the Solvency Support Fund for Strategic Companies. “The application for this SEPI Financing continues to be processed, having submitted all the documentation and information required by SEPI”, the Andalusian company said in a statement sent to the Spanish National Securities Market Commission (CNMV). Specifically, SEPI’s financing will be obtained by six subsidiaries of Abenewco 1, where most of the group’s commercial activity is centralised. In addition, Abenewco I will receive a total of 200 million euros from TerraMar Capital, of which 140 million will be provided in the form of a loan and 60 million in the form of equity. This will give TerraMar 70% of the share capital of Abenewco I, following the implementation of the conversions of the current convertible debt instruments.
Abenewco 1 will use the 60 million euros equity for the repurchase of the ‘New Money 2’, ‘A3T Convertible Put Option’ and ‘Reinstated Debt’. Abengoa explained that the new financial operation to ensure the stability and future of the Abenewco 1 group of companies is focused on three parts: obtaining liquidity, obtaining guarantees, and changes to the capital structure through the implementation of the restructuring agreement.
“Each part will proceed in parallel and is subject to the completion of the others, in the sense that the transaction cannot be finalised unless all parts are completed,” the firm said. In addition to the securing of guarantee facilities, the second part of the transaction involves the securing of a new New Bonding facility for a maximum amount of 300 million euros, together with the renewal and extension of the two existing New Bonding facilities, to cover the needs of the Abenewco 1 group of companies for the implementation of its business plan until 2027. As with the two existing lines, the new New Bonding line will be granted by a group of financial institutions and will be covered by CESCE, in this case for 60% of the risk in international guarantees. This line is pending approval by the financial institutions and CESCE.
Finally, as explained by the firm, the operation contemplates changes in the capital structure through the implementation of the restructuring agreement, mainly through the conversion into capital of certain convertible debt instruments in force and subscribed in previous years, such as the ‘Mandatory Convertible Abenewco 1’, ‘Senior Old Money’ and ‘Junior Old Money’.
These instruments will be converted into shares of the issuing companies (Abenewco 1, Abenewco 2 bis and Abenewco 2, respectively). Immediately after the conversion of the instruments into shares, TerraMar will subscribe to a capital increase of 60 million euros, giving it control of 70% of the share capital of Abenewco 1 and diluting the remaining new shareholders resulting from the conversion of the convertible debt instruments. TerraMar’s offer includes the possibility for Abengoa’s shareholders to participate in the investment jointly with TerraMar, sharing up to a maximum of 10% of their investment (seen on the total investment of 200 million euros), under the same terms and conditions under which Terramar would make its contributions. And only if Abengoa’s shareholders can contribute a minimum of 5 million euros. In addition, the restructuring agreement provides for certain economic rights in favour of Abengoa, payable after the repayment of the SEPI Financing, subject to the approval of a creditors’ agreement.