For the last five years a bank consortium consisting of four German banks have provided the majority of the long-term interest-bearing financing for the STRAX Group. The current financing facility matures in October 2020 and as a result STRAX has evaluated several financing alternatives in the last 6-9 months.
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After evaluation and negotiations STRAX selected Proventus Capital Partners and have signed a senior secured loan facility in the total amount of MEUR 30. The loan proceeds will be paid out in two tranches, a subordinated tranche of MEUR 6 in July 2020 to provide additional working capital until the full amount is paid out in October 2020, in connection with the refinancing of the maturing loans to the German bank consortium, upon which the entire Proventus loan facility will be unsubordinated.
The loan from Proventus Capital Partners is for a term of five years and the full amount is denominated in EUR. The loan will carry a Euribor +7.5 percent interest rate, in line with current market pricing, as well as the average financing costs currently paid. The loan is governed by covenants that are primarily profitability and cash flow based. Provided the covenants are fulfilled, the loan agreement allows yearly dividend of up to 50 percent of profits, allowing for expected future levels of dividends.
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“We are very happy to again partner up with Proventus Capital Partners for interest bearing-financing. We have had a particularly good partnership throughout the five-year period between 2010 and 2015 when Proventus initially financed the STRAX Group. We have always maintained a good business relationship and Proventus have always proven to be business oriented and demonstrated good understanding of the fast moving and entrepreneurial environment and culture of STRAX. A culture that has paid off very well throughout the challenges and opportunities during the past six months.” says Gudmundur Palmason CEO, STRAX Group.
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