FCC shareholder Carlos Slim bows to bank lender pressure regarding EUR 600m capital increase
FCC’s leading shareholder Carlos Slim has agreed to bank lender pressure regarding a EUR 600m capital increase, El Confidencial reported late Sunday (11 October).
The banks have conditioned a new phase of debt refinancing on FCC's EUR 4.5bn on the conglomerate's shareholders' further injection of more cash into their business, the Spanish-language report said, citing unidentified sources.
Santander, BBVA, Sabadell, Popular, Caixabank and Bankia have agreed that the capital raise must come before additional debt forgiveness. FCC's Slim is seeking a 5% overall debt haircut or a 15% reduction in the amount owed on the company's junior debt class, known as Tranche B, the report noted.
The company's recent refinancing extended debt maturities but left interest rates of 11%-16% on a portion of the Tranche B loan, a level considered too challenging at the company's current cash generating capacity, the report noted.
The lion's share of the proceeds of the proposed EUR 600m capital increase would go to pay down part of the EUR 900m outstanding on FCC’s Tranche B loan, the report said.
In order to maintain his current stake of 25.6%, the capital increase would cost Slim EUR 153m, while 22.4% shareholder the Koplowitz family would need to invest EUR 134.4m or see its stake diluted to around 15%, the report added.
El Confidencial