Oriflame refinances credit facility

By Andrew MCDOUGALL

- Last updated on GMT

Oriflame refinances credit facility

Related tags Finance

Swedish manufacturer Oriflame Cosmetics has signed a new €110m Revolving Credit Facility replacing the existing €330m facility, and has adjusted its reduced debt levels accordingly.

The new facility sees its existing core banks: HSBC Bank plc, ING Bank, Nordea, Raiffeisen Bank International AG, and SEB, as lead arrangers; and it takes over from the previous facility which was signed in May 2011, with maturity in 2016.

A revolving credit arrangement allows a company to borrow up to its credit limit without having to reapply each time it needs cash. As the money is repaid, it is available to be borrowed again.

As a result of reduced net debt levels over the last years, the new facility has been sized accordingly and will be used for general corporate purposes, primarily to cover for quarterly cash flow fluctuations within the calendar year.

“We are very pleased with the long-term relationship we have established with our core banks and note holders,”​ says Gabriel Bennet, CFO Oriflame.

“Having completed the refinancing with our current group of core banks and aligned the covenants with our note holders, we look forward to continued good co-operation both through central financing and ancillary services in the various regions where we operate.”

The Facility was co-ordinated by Nordea and SEB, who also acted as Mandated Lead Arrangers together with HSBC Bank plc and ING Bank. Raiffeisen Bank International AG participated as Lead Arranger.

As part of the refinancing process, the covenants for the company’s existing Private Placement Notes and the new Revolving Credit Facility were aligned. The following financial measures constitute the aligned set of covenants:

  • Consolidated Net Debt to Consolidated EBITDA less than or equal to 3.0 times
  • Consolidated EBITDA to Consolidated Finance costs greater than or equal to 5.0 times
  • Consolidated Net Worth greater than or equal to €120m

The financial measures as defined in the Revolving Credit Facility Agreement and the Private Placement Notes Amendment document will be disclosed in the company’s financial reports on a quarterly basis, starting from the report for the second quarter 2015.

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