Scandinavian Biogas to launch written procedure following constructive discussion with certain bondholders
Scandinavian Biogas Fuels International AB (publ) (the ”Issuer”) has reported deteriorating earnings during the past quarters, which is mainly derived by increased operational and maintenance costs at Södertörn, legal expenses, penalty fees in South Korea, and increased personnel costs in Norway.
As a consequence, the Issuer has, when preparing the consolidated financial statement for the third quarter, come to the conclusion that the Company did not fulfil the Maintenance Test as per September, 30 2018 as stipulated in The Terms and Conditions (published on the Issuer’s webpage www.Scandinavianbiogas.com) of the Issuer’s corporate bond loan.
Consequently, the Issuer will request that the bondholders temporarily waive the Issuer’s undertaking of the fulfilment of the Maintenance Test for the third and fourth quarter 2018.
As part of the waiver request, the Issuer´s balance sheet and liquidity will be strengthened by a minimum injection of SEK 16 million in subordinated loans and equity. The SEK 16 million is already committed by the largest shareholders but the target is to re-capitalise the Issuer with SEK 22-27 million during a rights issue prior to March 31, 2019. This is in addition to the SEK 18 million already provided in the second and third quarter 2018.
The Issuer is continuously working to improve its financial position and is evaluating a variety of strategic and capital-based structural alternatives aiming to secure a long-term and sustainable capital structure as well as an investment programme to substantially improve operations at the Södertörn facility.
The Issuer has been discussing the waiver request and subsequent injection of equity and/or subordinated loan with a group of the largest Bondholders, holding nearly 47% of the outstanding amount, which have confirmed their support for the waiver request.
The Issuer will shortly call for a notice to written procedure to receive the bondholders’ formal approval of the waivers.
Pareto Securities acts as financial adviser and for further information regarding the waiver request and the Issuer’s undertaking, please contact your broker at Pareto Securities.
The interim report for third quarter is planned to be published on Friday 9th of November 2018.
For further information, please contact:
Matti Vikkula, CEO and president,
+46 70 597 99 38, firstname.lastname@example.org
The information in this press release is such that Scandinavian Biogas Fuels International AB (publ) must disclose in accordance with the EU Market Abuse Regulation (EU MAR) No. 596/2014. The information was submitted for publication on 8th of November 2018, at 15:30 CET.