Brierley Debt Deal Done
Sydney Morning Herald
Friday April 9, 1999
Brierley Investments is ready to start investing again after putting the final touches to its long-awaited $US600 million ($962.1 million) debt refinancing package.
The Kiwi investor yesterday reached agreement with two banks to underwrite the package, which includes a new set of loan covenants and a streamlined set of bankers.
Brierley's group treasurer, Mr Stephen Temple, said: "It means that our whole capital restructuring is in place and we are in control of our own destiny."
Under the deal, HSBC New Zealand and Overseas Union Bank of Singapore will arrange the facility and have jointly underwritten the full amount.
Up to six financial institutions will participate in the facility as arrangers and co-underwriters.
Brierley came under pressure from its bankers last year when a $NZ1.19 billion ($1 billion) abnormal writedown saw it breach loan covenants on more than $NZ2 billion in debt.
Believed to be among the new covenants are restrictions on the company's gearing ratio. Before the deal, Brierley had about 54 bankers spread across 30 debt facilities and four currencies.
"All the banks have been reserving their rights and any small bank could have been a nuisance," Mr Temple said.
The refinancing comes ahead of another announcement later this month in which the company will unveil more details about its strategy under executive chairman Sir Selwyn Cushing - replacing the strategy outlined by former executive chairman Sir Roger Douglas last year.
The business plan will outline how the company will approach issues such as dividends and, possibly, include a share buyback, as well as the appointment of a new managing director.
Brierley's Australian chief, Mr Jonathan Pinshaw, has been rumoured in recent months to be the frontrunner, though the company has played this down.
Broking analysts believe Brierley may soon be in a position to pay a dividend, with at least 1c possible for the full year to June and major shareholder Camerlin keen to see some form of pay-out.
Brierley was steady at NZ45c on the New Zealand Stock Exchange.
© 1999 Sydney Morning Herald
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