Despite an earlier announcement that a plan to recapitalise Safilo, it now seems the announcement may have been premature.
In October, the Italian Stock Exchange said it had approved a recapitalisation plan for the Safilo Group to be executed in connection with a binding investment agreement underwritten by HAL Holding N.V (HAL).
But just a few weeks later, the Safilo Group said it has been informed by HAL Holding N.V. that only 1.03 percent of the senior notes due 2013 have been tendered at the early bird date in addition to the 38.76 percent already committed by existing note-holders upon the tender offer and recapitalisation plan announced on 19 October between the two companies.
As a result, Safilo’s CEO Roberto Vedovotto, in comments to the financial markets, said: “The chance that the tender will not be successful cannot be neglected. In such event, the overall recapitalisation plan might not take place and the company would again be in a highly leveraged situation and will, in all likelihood, default under its banking facilities by year-end.”
A statement also issued by HAL reiterates that if the minimum of 60 percent of the notes is not reached by the 18 November deadline, the deal will not happen. “Would the tender offer not be successful, the anticipated transaction consisting of a capital increase of Safilo and the sale of the non-USA retail chains to HAL which, in total, will provide Safilo with 283 million euros cash, will not materialise.”