Search filter
Tags
Tags
Back

Cementos Portland Valderrivas to reduce debt by capitalizing a loan from FCC

25/03/2014

Cementos Portland Valderrivas to reduce debt by capitalizing a loan from FCC

Cementos Portland Valderrivas to reduce debt by capitalizing a loan from FCC

The Board of Directors of Cementos Portland Valderrivas will ask the Shareholders' Meeting on 29 April to approve a capital increase by capitalising a subordinated loan from FCC, including accrued interest.

The increase will be performed at €8 per share, and 13,878,094 ordinary shares will be issued, 36% of the current number outstanding. The price of the increase was determined using the average share price in the market in the last quarter, which was €7.99. The share closed at €7.70 yesterday.

This operation will strengthen CPV Group's balance sheet by increasing equity and reducing debt, which, in turn, will lead to a decline in financial expenses. FCC's stake in the company will also increase, from 69.8% currently to 78%, notably strengthening the company's position vis-à-vis potential M&A. Net debt reported by CPV Group at 2013 year-end will be reduced by 8.1%.

The loan is part of the syndicated financing agreement between Cementos Portland Valderrivas and a group of banks, signed on 31 July 2012, for 1.114 billion euro. It included an agreement for financial support between FCC and CPV, whereby the former committed to contribute equity in the form of a capital increase or subordinated debt in the amount of 100 million euro.