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DMC Group plans major financial restructuring programme
30 Jan '06
2 min read
Textile conglomerate DMC group has decided to strengthen its shareholders funds by refocusing on three activities where the group has a leadership position, i.e. Craft, Sportswear and the Loisirs & Créations Chain, and after a significant reduction in its debt (- €170 million in 5 years).
The group has opened negotiations with its lenders and its main shareholder, which have led to the signing of a protocol agreement.
The terms of this agreement expect a relative stability of the share and the stock market and should provide the possibility to the market to subscribe to a capital increase and to the issue of convertible bonds, both guaranteed to at least 75 percent by the lenders as well as the group's leading shareholder, Pienza International BV (Guinness Peat Group).
These various issues will be proposed with the maintaining of the preferential subscription right, in favour of the current shareholders.
An Extraordinary General Assembly will be held on 27 February 2006 to pronounce on these operations, which should be proposed to the market during March 2006 at the earliest.
Following these market operations, DMC's protocol bank debt should be reduced from €56 million to €20 million. The remaining €20 million will be paid off to the current lenders, it having undertaken an engagement to structure new financing prior to the market operations.
2005 was highlighted by a euro/dollar exchange rate which was still unfavorableand by the explosion of Asian imports, and should close for DMC with a loss higher than that recorded in 2004, but which was nevertheless controlled given the harsh economic and monetary environment.
The group has opened negotiations with its lenders and its main shareholder, which have led to the signing of a protocol agreement.
The terms of this agreement expect a relative stability of the share and the stock market and should provide the possibility to the market to subscribe to a capital increase and to the issue of convertible bonds, both guaranteed to at least 75 percent by the lenders as well as the group's leading shareholder, Pienza International BV (Guinness Peat Group).
These various issues will be proposed with the maintaining of the preferential subscription right, in favour of the current shareholders.
An Extraordinary General Assembly will be held on 27 February 2006 to pronounce on these operations, which should be proposed to the market during March 2006 at the earliest.
Following these market operations, DMC's protocol bank debt should be reduced from €56 million to €20 million. The remaining €20 million will be paid off to the current lenders, it having undertaken an engagement to structure new financing prior to the market operations.
2005 was highlighted by a euro/dollar exchange rate which was still unfavorableand by the explosion of Asian imports, and should close for DMC with a loss higher than that recorded in 2004, but which was nevertheless controlled given the harsh economic and monetary environment.
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