31 March 2019

OT Logistics S.A. holds a contract with the biggest creditors pertaining to debt restructuring with value of PLN 175 million

OT Logistics S.A. has signed a contract on joint terms and conditions of the Group’s debt with a consortium of banks crediting the Group, successfully finalizing talks commenced in June 2018. According to the contract, after having fulfilled particular requirements by the Company, inter alia, standardization of financing conditions, partial reduction of an interest rate, conditional prolongation of maturity dates for financing by at least 12 months, establishment of new collaterals as well as conditional award of new financing.

“Achievement of an agreement with the consortium of Banks – the largest financial creditors of the Group is a significant step for both parties and for the entire process. The contract, which has just been concluded, is a fruit of work of all parties taking part in this process i.e. banks, major bondholders as well as Bank Gospodarstwa Krajowego. At present, we are preparing documents so that the main contractual conditions will be the same for all creditors, and for bondholders too. We commence actions to meet all the terms and conditions on implementation of this contract and we work on reaching an agreement with the other financial creditors. It is equally important that the contract will allow focusing on implementation of a recovery plan in full and on improvement of operational effectiveness of the Group, at the same time protecting interests of all groups of the financial creditors. At this stage, I would like to thank all the parties and persons working on achievement of the agreement, for good will and involvement in the whole process which in next weeks – I hope so – should finally come to an end,” said Radosław Krawczyk, President of the Management Board of OT Logistics S.A.

The most important terms and conditions of the agreement refer to standardization of bilateral conditions and consortium credit contracts awarded by the consortium’s banks, prolongation of the maturity date for available financing by 12 months from a date of submitting the last request for entering registered pledges and mortgages stipulated in the contract as well as rescheduling of repayment instalments, payable since July 2019. “Standardization and partial reduction of the interest rate of the awarded financing are also very important points of the contracts. It will allow OT Logistics to decrease financial costs which in last quarters affected the Group’s results. Creditors have obtained a commitment of the Company and our subsidiaries to grant new collaterals,” adds Radosław Krawczyk, President of OT Logistics. Total value of the debt constituting the subject matter of the contract comes to PLN 175 million. The contract also provides for a conditional commitment of the consortium’s banks to grant new financing to the Company for strengthening the Group’s liquidity.

The parties to the agreement are OT Logistics S.A. and subsidiaries: OT Port Świnoujście, OT Port Gdynia, C.Hartwig Gdynia, Rentrans Cargo, Rentrans International Spedition, STK, Żegluga Bydgoska, Kolej Bałtycka and RCI. On the part of the creditors they include: BGŻ BNP Paribas (including as a legal successor of Raiffeisen Bank Poland), Santander Bank Poland and mBank, with the reservation that the last one also acts as a credit agent and a security agent. The contract on joint terms and conditions shall come into force when the agent receives all, standard for this type of contracts, documents including corporate consents of each and every party. It is also required to confirm the fact of concluding an annex to the credit contract awarded to the Company by Bank Gospodarstwa Krajowego and to make amendments to the terms and conditions on issuance of series G bonds, issued by OT Logistics as well as to provide the Company with financial support by the main shareholder.

Additional terms and conditions include issuance of H bonds (with value of up to PLN 125 million). Its resources are to be allocated for refinancing the maximally large number of series D and F bonds. OT Logistics is also to reach an agreement with Croatian funds – shareholders of Luka Rijeka port operator – as to the principles on further cooperation within the scope of management of this company’s shares held.

“There are still a lot of challenges for the OT Logistics Capital Group, however I believe that the concluded agreement will enable us to gain impetus again and improve our financial and operating outcome. We wish to start getting rid of the indebtedness ballast in the coming quarters. We are aware of our potential and I am glad that it is also discerned by our creditors, demonstrating such large confidence to the Group,” sums up Radosław Krawczyk, President of OT Logistics.

The recovery plan which shall be conducted based on the restructuring contract was adopted in December 2018. It aims at improving the financial liquidity and achieving, in 2020, consolidated EBITDA margin at the level of approx. 10% through, inter alia, changes in the management structure of the Group, centralization of processes and elimination of duplicating competences, optimization of rates for rendered services with a simultaneous control of costs as well as sale of real property which is not used in ongoing operations. Positive effects are also to be brought by a reduction in capital expenditures. The plan assumes actions in the perspective of 1-2 years.

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