Diebold Nixdorf (Company), which sells ATMs, payment terminals and other technology, has announced that it, certain of its subsidiaries and certain creditors collectively holding a significant majority of the its outstanding secured term loan debt and secured notes (the “Consenting Creditors”) entered into a restructuring support agreement to effectuate a comprehensive debt restructuring transaction.
The unrelenting retreat from static points of contact in the payments and financial services industries has pushed the traditional terminal maker to breaking point.
The restructuring support agreement contemplates the effectuation of a delivering transaction through, among other things:
- A pre-packaged chapter 11 plan of reorganisation to be filed by the Company and certain of its subsidiaries (collectively, the “Debtors”) in connection with the commencement by the Debtors of voluntary cases under chapter 11 of title 11 of the US Bankruptcy Code,
- A scheme of arrangement to be filed by Diebold Nixdorf Dutch Holding B.V. relating to certain of the Company’s subsidiaries in connection with the commencement by Diebold Nixdorf Dutch Holding B.V. of voluntary proceedings under the Dutch Act on Confirmation of Extrajudicial Plans (Wet homologatie onderhands akkoord) and
- Recognition of such Dutch scheme pursuant to proceedings to be commenced under chapter 15 of the U.S. Bankruptcy Code by Diebold Nixdorf Dutch Holding B.V..
Under the restructuring support agreement, the Consenting Creditors have agreed, subject to certain terms and conditions, to support restructuring transactions that would result in a financial restructuring of the existing funded debt and existing equity interests of the Company and certain of its subsidiaries.
The Company’s outstanding common shares would be cancelled pursuant to the restructuring transactions, and holders thereof would not receive any recovery.
Due to the cancellation of the Company’s common shares, their listing on the New York Stock Exchange and the Frankfurt Stock Exchange will be terminated, the exact dates of which are expected to be communicated in due course prior to the end of the restructuring proceedings.
The restructuring agreement provides that the Debtors will seek approval of a $1.25 billion debtor-in-possession term loan credit facility (the “DIP Facility”).
The proceeds of the DIP Facility will be used to:
- Repay in full the term loan obligations, including a make-whole premium, under the Company’s super priority credit facility;
- Repay in full the Company’s asset-based revolving credit ABL facility and cash collateralise letters of credit thereunder;
- Pay costs and reasonable and documented out-of-pocket fees and expenses related to the court-supervised restructuring proceedings;
- Make certain “adequate protection payments”; and
- Fund the working capital needs and expenditures of the Company and certain of its subsidiaries and their non-debtor affiliates during the pendency of the court supervised restructuring proceedings.
The restructuring transactions remain subject to certain conditions, as well as the negotiation of further definitive agreements.
“Our company is focused on continuing our solid operational performance and delivering best-in-class products and services to banks and retailers around the world,” says Octavio Marquez, Diebold Nixdorf chairman, president and chief executive officer.
“With the support of our creditors, we have reached an agreement to restructure and strengthen our balance sheet, enhance liquidity and position Diebold Nixdorf for long-term success.
Our strengthened financial position also enables us to better serve our customers, employees, suppliers and partners. I am excited about the future of Diebold Nixdorf and all we will accomplish.”
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