Wendel, France’s largest publicly traded investment firm, said it’s prepared to sell part of construction-materials and additives business Materis SA as talks with 200 creditors to reschedule debt are complicated.
Numerous buyers have expressed “strong interest” in divisions making aluminates, admixtures, mortars and paints, Chief Executive Officer Frederic Lemoine said at a conference in Paris today. One of the divisions will be sold if an acceptable offer is made, he said.
Wendel, based in Paris, bought Materis for about 2 billion euros ($2.6 billion) in 2006, with lenders led by agent BNP Paribas SA providing about 1.97 billion euros of loans, according to data compiled by Bloomberg. Materis’s 1.84 billion-euro of senior loans are maturing from April 2013 to 2016. Wendel is seeking to push back 2013 and 2014 payments, and some “Anglo-Saxon” creditors are asking for unacceptable terms, Lemoine said.
“We can’t accept their requirement to live off the beast and take all the money generated by Materis,” the Wendel CEO said.
Creditors representing about 75 percent of Materis debt are ready to participate in the debt rescheduling proposed by Wendel, which will add extra cost for Materis, Lemoine said. That level of acceptance isn’t enough to “ensure a safe functioning of Materis in coming quarters,” Bernard Gautier, a Wendel board member, said today.
“We’re trying to raise that percentage. Some creditors have set an acceptance rate of 80 percent and more” to participate, Gautier said.
Materis’s earnings before interest, taxes, depreciation and amortization rose 3.5 percent in 2011 to 259.4 million euros as sales climbed 9.3 percent. Sales rose 4 percent like-for-like in the first two months of 2012, and the paints unit can “strongly” improve its margins, Lemoine said.
There’s no need for Wendel to re-inject money in a growing company, Lemoine said.