An ad hoc group of bondholders of Ahern Rentals’ $550 million 7.375% second lien notes due 2023, represented by Willkie Farr as legal advisor, has selected PJT Partners as financial advisor, according to sources. The bondholder group, which recently signed a cooperation agreement, seeks to engage with the company on a potential debt exchange, according to sources, who added that the group could also be looking to pre-empt additional dividend payments to shareholders. Ahern is family-owned.
The second lien notes last traded in size today at 73.75, according to TRACE. The capital structure also includes a $575 million revolver due 2022, which contains a springing financial covenant that would be triggered if availability falls below a certain level, according to sources.
In 2020, bondholders took issue with certain dividend payments to the owners of the Las Vegas-based provider of construction and high-reach equipment rentals, including CEO Don Ahern, as the proceeds were allegedly used to purchase real estate to be leased back to the company, as well as Ahern Rentals’ dealings with businesses controlled by the CEO, the sources said. In the meantime, the business has been suffering from significantly lower demand due to the Covid-19 pandemic.
Founded in 1953, Ahern Rentals has more than 54,000 pieces of equipment and serves customers in the construction, utilities and entertainment sectors, according to its website. The company specializes in the safe lifting of personnel or materials to work at height.
Ahern Rentals and Willkie Farr did not immediately respond to requests for comment. A representative for PJT Partners declined to comment.
--Adelene Lee, Harvard Zhang