Ineos Offers to Prepay Loans to Win Lender Consent to Reorganize for Move

Ineos Group Holdings Plc, the U.K.’s largest privately-held company, is offering to pay debt early if lenders agree to it reorganizing its structure following its move to Switzerland for tax purposes.

Ineos would pay a 25 basis-point fee due in May 2011 early and prepay 100 million euros ($133 million) of senior loans, spokesman Richard Longden said. The fee is being offered on Ineos’s loan refinancing announced in March. Lenders have until Dec. 16 to accept the proposal, he said.

Ineos plans to create two holding companies in Luxembourg and another two in Switzerland on top of its operating entities, Longden said. The company moved its headquarters to Rolle, Switzerland from Lyndhurst, England last week, he said.

“There are very few places in the world that are as creditor-friendly as the U.K.,” said Stephen Mostyn-Williams, founder of leveraged finance consulting firm smwlaw.

Ineos estimates it could potentially generate about 450 million euros of tax savings between now and 2014 as a result of the move to Switzerland, the company said on April 9. Its day- to-day businesses both in the U.K. and elsewhere will remain unaffected by the change of headquarters and tax residence.

Ineos, which has net debt of 7 billion euros, generates 70 percent of its sales outside the U.K., according to its website.

To contact the reporter on this story: Patricia Kuo in London at pkuo2@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net

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