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Refinancing on improved terms

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RNS Number : 6103F
Safestore Holdings plc
19 May 2017
 

19 May 2017

 

Safestore Holdings plc

 

Refinancing on improved terms

 

Safestore Holdings plc ("the Group") announces the refinancing of its US Private Placement Notes ("USPP") and an amendment and extension of its existing bank facilities to extend the average maturity and lower the cost of the Group's debt financing.

 

The key terms of the new and amended arrangements are as follows:

 

US Private Placement Notes

 

·      The existing $65.6m 5.83%1 2019 USPP and $47.3m 6.74%1 2024 USPP will be repaid in full

·      New Euro and Sterling denominated USPP will be issued with the following tenor and coupons:

€50.9m 7 year notes at coupon of 1.59%

€74.1m 10 year notes at coupon of 2.00%

£50.5m 12 year notes at coupon of 2.92%

 

Amendment and Extension of Bank Facilities

 

·      Existing UK and Euro revolving credit facilities are extended by two years from June 2020 to June 2022 with an option (on an uncommitted basis) to extend for a further year with the existing £126m term loan cancelled.

·      The amended facilities will comprise:

a £190m revolving credit facility of which c.£120m will be drawn.

a €70m revolving facility of which c.€46m will be drawn.

·      The margin on the amended facilities will be reduced by 25 bps from 150 bps to 125 bps.

·      Similarly, the non-utilisation fee on the undrawn facilities reduces from 0.6% to 0.5%.

·      The Group also has the option (on an uncommitted basis) to increase the quantum of the sterling revolving credit facility by £60m.

 

The Group will pay a 'make-whole' payment to existing USPP noteholders of c.£12.5m2 and will also break the Sterling/ Dollar cross-currency swap relating to the existing USPP notes which has a current mark-to-market value of c. £13m3 in favour of the Group.

 

Based on the current level of borrowings and interest swap rates, and taking into consideration the amortisation of initial fees, the Group's pro forma annual underlying finance charge will, over a full year,  reduce by c. £3m4 per annum and the Group's overall ongoing average cost of debt, including the USPP, will reduce by c. 120 bps5 to 2.4%. The weighted average maturity of the Group's debt increases from 3.4 years to 7.5 years. It is estimated that the Group's LTV ratio will be c. 33% (calculated by reference to the 31 October 2016 portfolio valuation) after the above transactions are completed.

 

The interest rate hedging in relation to the above amendment and extension of the bank facilities is expected to be completed in the coming weeks and an update will be provided in the Group's Interim Results on 15 June 2017.

 

The USPP will be issued to insurance company affiliates of AIG, Inc. and the bank facilities are provided by a syndicate of RBS, HSBC, Lloyds, Santander and BRED. It is expected that the new debt arrangements will come into effect on 31 May 2017.

 

Andy Jones, Chief Financial Officer of Safestore, commented:

 

"We are pleased to complete the refinancing of our bank facilities and US Private Placement notes, further reducing the Group's ongoing cost of debt whilst significantly improving the debt maturity and flexibility of our facilities.  We extend our thanks and appreciation to our funders for their ongoing support."

 

Notes

1 - Adjusted for the impact of cross currency swap agreements.

2 - Will be treated as exceptional finance costs. Value estimated as at 17 May 2017.

3 - Will be a treated as a movement on the derivative already reported in our income statement. Value estimated as at 17 May 2017.

4 - As compared to the guidance for our 2017 financial year of £10.5m to £11.5m given in our January 2017 Results Presentation.

5 - As compared to the position at 31 October 2016.

 

 

 

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

 

Enquiries

 

Safestore Holdings plc

Andy Jones, Chief Financial Officer

www.safestore.com

 

020 8732 1500

Instinctif Partners

Mark Reed

Guy Scarborough

020 7457 2020

 

 

Notes to editors:

 

·      Safestore is the UK's largest self-storage group with 134 stores, comprising 109 wholly owned stores in the UK (including 63 in London and the South East with the remainder in key metropolitan areas such as Manchester, Birmingham, Glasgow, Edinburgh, Liverpool and Bristol) and 25 wholly owned stores in the Paris region.

 

·      Safestore operates more self-storage sites inside the M25 and in central Paris than any competitor providing more proximity to customers in the wealthiest and densest UK and French markets.

 

·      Safestore was founded in the UK in 1998. It acquired the French business "Une Pièce en Plus" ("UPP") in 2004 which was founded in 1998 by the current Safestore Group CEO Frederic Vecchioli.

 

·      Safestore has been listed on the London Stock Exchange since 2007. It entered the FTSE 250 index in October 2015.

 

·      The Group provides storage to around 55,000 personal and business customers.

 

·      Safestore has a maximum lettable area ("MLA") of 5.64 million sq ft (excluding pipeline stores) of which 3.87 million sq ft is currently occupied.

 

·      Safestore employs around 600 people in the UK and France.

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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