Travelex Initiates Debt Restructuring with £84 Million Funding

The company recently failed to sell its assets with no viable offers.

Travelex is going to restructure its debt as the company has reached an agreement with at least 66.7 percent of its Senior Secured Noteholders (SSNs) and all of its Revolving Credit Facility (RCF) lenders.

According to Wednesday’s announcement, the company is receiving £84 million ($105.53 million) of new liquidity and an 84 percent reduction of its existing financial debt.

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The funding will be provided by the participating SSNs in the form of New Senior Secured Notes, who will take full control of the company and will be led by members of an Ad Hoc Committee of SSNs.

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Furthermore, the terms of the restructuring also detailed that the AHC will provide an initial commitment through bridge funding of £15 million ($18.85 million) with upsizing flexibility for both the AHC and any participating SSNs wishing to subscribe.

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The restructuring will also result in the full equitization of the existing €360 million ($406.55 million) SSNs, and also full reinstatement of the existing £50 million ($62.8 million) RCF in the form of a Reinstated Term Loan and c£10m guarantees in the form of reinstated guarantees – the latter two together form the new RCF.

The London Stock Exchange (LSE) filing also detailed that the participants in the new money will receive 100 percent of the equity in a new Travelex group holding company (New Holdco) and the SSNs will receive warrants over 17.5 percent of it while exiting. Bridge Funding providers will receive further warrants of 2.5 percent of New Holdco Equity.

The restructuring came after the company failed to get any fair offer to sell its assets, following the default of €14.4 million in coupon payments.

“This agreement marks a significant and positive milestone in the strategic initiatives which the Company has pursued over recent months,” Travelex’s CEO Tony D’Souza said. “The restructuring will provide Travelex with a stable platform through £84m of new liquidity and a substantial debt reduction, so that it can rebuild revenues under the stewardship of its new shareholders.”

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