Profil:
LPP SAUPDATE: LPP fashion secures approx. PLN 13.5 bln agreement with 21 lenders
Listed fashion group LPP has signed a credit agreement with a with a consortium of 21 banks covering extended supplier financing, a revolving loan and an investment loan, LPP announced in a market filing. The total value of the agreement is equivalent to approximately PLN 13.5 billion (EUR 3.2 bln).
The bank consortium consists of: HSBC, Santander Bank Polska, Pekao, BNP Paribas, Citi Bank/Bank Handlowy, Unicredit, ING, PKO BP and the EBRD.
Funds obtained under the agreement will be earmarked primarily for debt refinancing, supporting European logistics investments, and covering corporate needs, with rates linked to EURIBOR/WIBOR plus fixed margins.
LPP announced in a press release that the new debt structure is a response to the significant acceleration of sales network expansion, increased supplier financing and investments in logistics infrastructure.
Thanks to the consortium agreement, the company gains not only long-term stability, but also the opportunity to operate on a larger scale with significantly improved conditions for raising capital.
As stated, LPP gains access to significantly higher credit limits while reducing the cost of capital and extending the financing period.
The group pointed out that interest in the refinancing process among financial institutions significantly exceeded the company's needs and allowed it to attract new entities from Poland and abroad to the structure, in addition to its existing partner banks.
The credit agreement covers an investment loan of up to EUR 505 million and a revolving loan of up to PLN 2.8 billion (EUR 660 mln).
LPP has also concluded a framework financing agreement with banks, which in principle is a continuation of the supplier financing mechanism currently used by the group, known as 'reverse factoring'.
The company will offer its suppliers of goods and services the option of receiving payment directly from the consortium members. The company will be obliged to pay the consortium members the amounts they have paid to suppliers.
The company will provide its suppliers with banking platforms enabling them to obtain payment, with supplier financing (and thus the company's obligation to pay trade liabilities) limited to a maximum amount of USD 2.4 billion, with the possibility of flexibly increasing this limit.
The final repayment date for the investment loan has been set at 5 years from the date of conclusion of the agreement, and for the revolving loan - at 3 years from the date of signing the agreement, with the proviso that the revolving loan may be extended by a maximum of 2 years.
pel/ ao/ han/
