Gusbourne Plc, (AIM: GUS) the English sparkling wine producer today announces that it has completed a refinancing of its debt arrangements which were held with PNC Financial Services UK Ltd ("PNC") and a company associated with Lord Ashcroft through the issue of a new £20m long-term secured deep discount bond (the "Refinancing"), providing additional funding for future growth.
Background to the Refinancing
On 15 August 2022, the Company announced that it had increased its existing £10.5 million 5-year asset-based lending facilities by an additional £6 million to provide the Company with a total £16.5 million asset-based lending facilities with PNC ("PNC Facility") structured as a revolving loan facility. The PNC Facility carried interest at the annual rate of 2.50 per cent over the Bank of England Base Rate (the latest interest rate being 7.75%) and was payable monthly, with security by way of first priority charges over the Company's inventory, receivables and freehold property as well as an all-assets debenture, and contained financial and general covenants and customary events of default.
On 14 November 2023, the Company announced that it had agreed a short-term unsecured loan facility of £1.5m with a company associated with Lord Ashcroft ("Loan"). The Loan carried interest at the annual rate of 2.50 per cent over the Bank of England Base Rate and was repayable on demand.
The Company has now entered into an agreement with a company associated with Lord Ashcroft (Moongate Holdings Group Limited) for the issue of a new £20m long-term secured deep discount bond ("DDB") to support the Company's working capital and ongoing growth.
The subscription price of the DDB is £20m. The subscription proceeds of £20m have been used to repay the existing PNC Facility amounting to £16.3m, repay the short-term unsecured Loan of £1.5m, related fees and expenses of £0.6m and the remaining proceeds will be used for working capital and to support the ongoing growth strategy of the Company.
Key terms of the DDB:
· Issued at a discount of 7.75% per annum on quarterly rests;
· Nominal amount is £26.3m which is payable on the final redemption date of 12 August 2027, which end date is consistent with the PNC Facility;
· Early redemption of the DDB with not less than 90 days' notice (with early repayment fees);
· Accrued discount is payable on the early or final redemption of the DDB - allowing increased cash flow for the Company versus monthly interest repayments;
· Security over land, properties and stock, full fixed and floating security over the assets of both the Company and Gusbourne Estate Limited;
· Other key terms and conditions of the DDB are consistent with the PNC Facility.
Jim Ormonde, Chairman, said:
"The Board are pleased to announce the new long-term funding and are very appreciative of the continued support of the major shareholder to underpin the Company's growth strategy."
Related Party Transaction
Lord Ashcroft holds an interest in 66.3% of the Company's ordinary shares of 1 pence each and is a Substantial Shareholder in the Company as defined by the AIM Rules for Companies ("AIM Rules"). The issuance of the DDB constitutes a related party transaction pursuant to AIM Rule 13. The independent directors of the Company for the purposes of the Refinancing, having consulted with the Company's nominated adviser, Panmure Gordon, consider that the terms of the DDB are fair and reasonable insofar as shareholders are concerned.
For further information contact:
Jonathan White, CEO
Katharine Berry, CFO
Phil Clark, Investor Relations
+44 (0)12 3375 8666
Panmure Gordon (UK) Limited (Nomad and Sole Broker)
James Sinclair-Ford / Ailsa Macmaster / Lauren Riley
Hugh Rich / Rauf Munir
+44 (0)20 7886 2500
Kate Hoare / Ben Robinson / India Spencer
+44 (0)20 4529 0549
This announcement contains inside information for the purposes of article 7 of the Market Abuse Regulation (EU) 596/2014 as amended by regulation 11 of the Market Abuse (Amendment) (EU Exit) Regulations 2019/310. With the publication of this announcement, this information is now considered to be in the public domain.