Lehto Group Plc
30 June 2020 at 23.00 (EET)
Lehto Group Plc has signed a new revolving credit facility agreement. The agreement replaces the previous EUR 75 million syndicated revolving credit facility (RCF) agreement with OP Corporate Bank plc, Nordea Bank Plc and Swedbank AB. EUR 54 million of the limit is currently in use and the original termination date of the agreement was 1 November 2021.
The new revolving credit facility agreement is done with the same bank syndicate formed by OP, Nordea and Swedbank. The agreement amounts to EUR 54 million and is valid until 31 December 2022. According to the agreement, part of the loan will be repaid by the end of the agreement period. The agreement includes partial collaterals as well as financial covenants related to EBITDA, interest bearing net debt, and net gearing that may also have influence on dividend distribution during the validity period of the revolving credit facility agreement.
Lehto plans to arrange a rights issue with a target to raise gross proceeds of approximately EUR 20-25 million to increase its cash and equity position. The company’s largest shareholder, Lehto Invest Oy, controlled entity of CEO Hannu Lehto, has committed to vote in favor of proposals related to the contemplated rights issue, made by the Board of Directors for the Extraordinary General Meeting, and participate in the rights issue at least in proportion to its holding at Lehto per 30 June 2020.
Lehto Group Plc’s Board of Directors will convene an Extraordinary General Meeting to decide on granting the authorizations related to the rights issue. The objective is to have the rights issue completed by the end of year 2020. OP Corporate Bank plc will act as a sole lead manager and arranger in the contemplated rights issue.
The financing agreement has no direct effect on Lehto’s indebtedness ratios. If realized in full, the gross proceeds from the contemplated rights issue are estimated to increase Lehto’s equity ratio by approximately 3-4 percentage points (on 31 March 2020, the equity ratio was 35.5%, excluding IFRS16 items, and 29.9% including IFRS16 items).
“Financing is one of the key prerequisites for a well-functioning business in the construction industry. The signed agreement now provides a good basis for continuing the restructuring efforts and promoting the business in the future as well. With the share issue, we want to strengthen our ability to implement the strategy and develop a modular construction method based on prefabricated elements”, says CEO Hannu Lehto.
CFO, Lehto Group Plc
tel. +358 400 944 074