Vivarte’s Lenders Said to Hire Advisers Before Debt TalksJulie Miecamp and Luca Casiraghi
Lenders to Vivarte SAS appointed advisers before the start of talks about the French retailer’s 2.8 billion euros ($3.8 billion) of loans, according to a person with knowledge of the process.
Investment bank Houlihan Lokey and attorneys Willkie Farr & Gallagher LLP will represent a lender committee to coordinate negotiations with the company, which is owned by Charterhouse Capital Partners LLP, said the person, who asked not to be named because the talks are private.
Vivarte last week failed to persuade lenders to drop loan covenants capping its ratio of debt to earnings. The Paris-based company got approval from 65.1 percent of lenders for the request, short of the 66.6 percent required, a person familiar with the situation said at the time.
Andrea Hewitt, a spokeswoman in London for Houlihan Lokey, wasn’t immediately available for comment on the appointment. Antoinette McGovern, a spokeswoman for Willkie Farr in New York, and Gary Sunderland, head of information resources at Charterhouse, both didn’t respond to requests for comment.
Vivarte Chairman Marc Lelandais presented the request to waive covenants to more than 100 of the company’s lenders last month as the fashion retailer confronts slowing sales amid a sputtering economic recovery.
The company’s leverage ratio climbed to 6.96 times at the end of May, exceeding the limit of 6.05 times. It also breached its interest cover ratio, a measure of how easily it can pay interest. That measure was 2.17 times in May, below the minimum threshold of 2.25.
Charterhouse bought the company, founded in 1896 to sell “elegant but affordable shoes,” from PAI Partners SAS in 2007 in a deal financed with 3.4 billion euros of loans.
The appointment was reported earlier by CapitalStructure. Willkie Farr is legal adviser to Bloomberg News.