UPDATE: Autogrill Aims To Reduce Net Debt, Meet Commitments
March 04 2009 - 9:09AM
Dow Jones News
Italian restaurant operator Autogrill SpA (AGL.MI) said
Wednesday it is focused on reducing its debt of EUR2.14 billion and
on respecting its financial commitments, moving to quell market
concerns the company may have to refinance its debt amid a slowing
economy.
"As previously announced, the company is focused on reducing its
net indebtedness and on respecting its financial commitments," a
spokesperson at Autogrill told Dow Jones Newswires.
Autogrill secured a credit line of about EUR1 billion in March
of last year to fund the acquisition of 49.95% of Aldeasa and the
purchase of 100% of World Duty Free, it said at the time. The
credit line was underwritten by BNP Paribas SA (BNPQY), Intesa
Sanpaolo SpA (ISP.MI), Royal Bank of Scotland Group PLC (RBS), and
UniCredit SpA (UCG.MI), who acted as mandated lead arrangers and
bookrunners. ING Bank and Natixis acted as mandated lead arrangers
and sub-underwriters. Autogrill's shares tumbled 5.4% in Milan
Wednesday, the day after a report by Milan's Equita brokerage said
it thought that the slower economy would make it hard for Autogrill
to respect the conditions of its debt covenants later this
year.
Equita said that a slowdown in U.S. airport traffic in January
prompted the brokerage to slash forecasts for earnings before
interest, taxes, deprecation and amortization, or Ebitda, to EUR589
million for 2009 from a previous estimate of EUR603 million.
The lower Ebitda, according to Equita, raises the possibility
that Autogrill will have to refinance.
"Autogrill must respect a covenant of a debt/Ebitda ratio of 3.5
times, and from June 2009 the possibility of a breach could produce
the risk of refinancing," said the Equita note. As part of the EUR1
billion credit line, Autogrill took out EUR875 million in loans,
due in March 2013, which can be prolonged for one or two years, the
company said March 19, 2008.
-By Jennifer Clark, Dow Jones Newswires; 39 02 5821 99 01;
jennifer.clark@dowjones.com
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