Unibet to Reduce Costs via €24 million Financing Deal
20th November 2009 8:11 am GMT
Unibet Group plc said yesterday that it had secured an agreement with a leading international bank for a twelve month revolving credit facility with a maximum value of €24.0 million, which will be used, among other things, to cover the early redemption of the remaining nominal value of €65.8 million of the bonds used to finance the acquisition of Maria Holdings in 2007.
Through the early redemption of the bonds, Unibet said it expects to save between €4 million and €5 million in finance costs during the facility's duration compared to holding the bonds to maturity, which would occur in December 2010.
This saving includes early redemption costs of approximately €1.4 million in the fourth quarter of 2009.
In addition to saving up to €5 million in finance costs, a significant benefit of the early redemption of the bonds is that the foreign currency volatility in the income statement caused by the previous bond facility will now be mitigated.
In the nine month period up until September 2009, the unrealised exchange gain on the bond amounted to £2.9 million, including a loss of £4.0 million and interest expense of £1.5 million in Q3 alone, reflecting the strengthening of the British pound to the Euro.
The early redemption will occur on Tuesday December 22nd and the record date in respect of the early redemption will be the previous Tuesday 15th. Pursuant to the terms and conditions for the bonds the amount payable on early redemption will be €1,010 per bond with a nominal value of €1,000.
The annual interest payment will be paid on December 21st and in addition the company will pay an interest amount of €0.27 per bond for the period from December 21st up to and including December 22nd.
The bonds will be delisted from NASDAQ OMX Nordic Exchange in Stockholm Retail Bond List before the record date in accordance with the standard procedures of the regulated market.
Shares in Unibet Group plc (Co. Profile) (NASDAQ OMX:UNIB) are currently trading at SEK194.00 per share in Stockholm this morning.
