Fri 01/08/2021 08:58 AM
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Spanish wedding dress retailer Pronovias has received an €18 million equity cheque from sponsor BC Partners for a covenant holiday until spring next year, with the next covenant test in June 2022, sources told Reorg. The amendment was secured with unanimous approval, sources added. Continue reading for the EMEA Middle Market by Reorg team's update on Pronovias, and request a trial for coverage of stressed, distressed and high-yield credits in the region. 

As part of the deal, Pronovias will have to keep a minimum liquidity of €5 million on its balance sheet until the end of March 2022, sources said. A potential breach of the liquidity covenant would have to be cured in one month.

Some investors commented that this may not be a comprehensive solution to the company’s capital structure and further amendments may be needed. The company previously received covenant waivers from its four revolving credit facility lenders until March 2021 and BC Partners provided €5 million of equity at the end of 2019 to support the business.

At the end of October 2020, the company had €12 million liquidity consisting of €6 million of cash and €6 million of undrawn facilities, management of the company told lenders on a recent call, as reported. The performance was better than initially expected throughout the Covid-19 pandemic, according to sources.

Pronovias’ capital structure consists of:

  • A €215 million first lien term loan paying Euribor+450 bps due 2024;

  • A €60 million second lien paying E+750 bps due 2025; and

  • A €45 million RCF due 2023, which is ranked pari passu with the first lien term loan.

Reorg Covenant analyzed the group’s SFA at the time of the primary issuance of the debt. For a copy of the full report click HERE. The agreement is governed by English law.

-- Aurelia Seidlhofer, Luca Rossi
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