£200 Million Credit Facility & Associated
UK Export Finance Export Development Guarantee
Harland & Wolff Group Holdings plc (AIM: HARL), the UK quoted company focused on strategic infrastructure projects and physical asset lifecycle management, reports that it has sought and obtained permission from Ministers to advance negotiations in relation to the proposed £200 million guaranteed loan facility with UK Export Finance (UKEF) under its Export Development Guarantee Scheme (“EDG Scheme”).
In order to ensure that the proposed loan facility is compliant with the relevant rules where UKEF was to provide a 100% guarantee to UK commercial lending banks (“Banks”), UKEF will now appoint an independent third party to ascertain an appropriate premium over SONIA. This process will commence in January 2024.
Following ministerial approval to progress negotiations, the Company will now firm up the Bank syndicate and appoint a lead arranger. In parallel, the Company will commence necessary documentation in relation to the credit and guarantee agreements as well as the security package that will be offered. It is likely that the security package will entail providing the Banks with a first charge on substantially all the assets of the Company, similar to what has been provided to Riverstone Credit Partners in March 2022. This transaction will be subject to the agreement of Ministers, final approval of the financing terms, and Investment Committee approvals of the Banks.
The Company also reports that no warrants are expected to be issued to the Banks or UKEF.
Through a combination of cash currently held on the balance sheet and expected cash flows in 2024 generated from existing contracts, the Directors consider that the Company has sufficient funds to meet its working capital requirements until the new loan facility is completed.
A further detailed announcement will be made by the Company in the event that this credit facility and associated guarantee is placed, and the transaction has been executed.
For further information, please visit www.harland-wolff.com
