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ZURICH, Nov 13 (Reuters) - Swiss airline caterer Gategroup Holding, shareholders RRJ Capital and Temasek as well as the company’s lenders have reached an agreement in principle to back a debt restructuring, the Glattbrugg-based company said on Friday.
Gategroup has been hit as airlines grounded planes during the COVID-19 pandemic, with passenger numbers still just a fraction of those seen before the virus spread.
“The proposed transaction will provide the Group with significant new liquidity to address short and medium-term needs and will help establish a stable capital structure,” Gategroup said on Friday.
The deal provides 500 million Swiss francs ($547.71 million)in new funding from Singapore state fund Temasek and Asian investment firm RRJ, including 25 million francs in equity and a 475 million franc subordinated, convertible loan.
Another 200 million francs is coming from a senior secured interim liquidity facility extended by the shareholders, repayable upon completion of the transaction or at the latest six months after issuance. The extension of the maturity of the group’s syndicated loan facilities to October 2026 and certain other amendments was also agreed.
Gategroup CEO Xavier Rossinyol called the proposed deal “a key milestone”, adding the company plans to further cut costs and prepare for a post-pandemic expansion of operations when passenger demand returns. ($1 = 0.9129 Swiss francs) (Reporting by John Miller; Editing by Kirsten Donovan)