Heathrow Finance announces success of consent solicitations for four notes

By Wendy Van Sickle

Columbus, Ohio, Aug. 10 – Heathrow Finance plc announced the success of its consent solicitations to amend its £300 million 4¾% senior secured notes due 2024 (ISIN: XS1904681944), its £250 million 5¾% senior secured notes due 2025 (ISIN: XS1120937617), its £275 million 3 7/8% notes due 2027 (ISIN: XS1622694617) and its £300 million 4 1/8% senior secured notes due 2029 (ISIN: XS2081020872), according to a London Stock Exchange announcement.

At meetings held by teleconference on Tuesday, holders of 89% of the 2024 notes were represented, and an extraordinary resolution was passed by holders of 91.9% of the notes represented at the meeting.

Holders of 88.46% of the 2025 notes were represented, and an extraordinary resolution was passed by holders of 87.07% of the notes represented at the meeting.

Holders of 86.22% of the 2027 notes were represented, and an extraordinary resolution was passed by holders of 99.64% of the notes represented at the meeting.

Holders of 87.31% of the 2029 notes were represented, and an extraordinary resolution was passed by holders of 95.3% of the notes represented at the meeting.

Each supplemental trust deed implementing the amendments and waiver has been executed, the company said Tuesday.

As announced on July 19, for the financial year ending Dec. 31, the group’s total interest paid is expected to be £187 million while under the base case scenario its cash flow is expected to be £253 million resulting in a group interest coverage ratio (ICR) of 1.35.

“Although this would not constitute a breach of the group ICR covenant, it results in only £66 million of headroom in relation to such covenant,” the company said in a previous announcement.

As a result, the company is seeking a waiver of any event of default that would arise from a breach of the group ICR covenant for the financial year ending Dec. 31.

In consideration of noteholders agreeing to the waiver, the company was proposing to increase the minimum liquidity covenant to £250 million from £200 million for each of the remaining quarterly testing dates during the waiver period and to amend the waiver period end date to remove the right of the company to bring the waiver period to an end prior to July 1, 2022.

The company said it has also engaged with lenders and investors of its permitted borrower debt to discuss implementing a waiver of the ICR, an increase in the minimum liquidity covenant and the removal of the right to bring the waiver period to an end prior to July 1, 2022 on the same terms as the proposed amendments to the notes. Lenders and investors representing 95.76% of its permitted borrower debt, excluding the notes, have informed the company that they intend to approve the proposals in relation to their facilities.

The company said that overall, at least 70.87% of the aggregate principal amount of all of the issuer’s permitted borrower debt, including the notes, have indicated that subject to client, credit or investment committee or other approvals, they intend to approve the proposals.

Consent fee

Each noteholder from whom a valid consent instruction was received, irrespective of whether they vote in favor or against the amendment, will receive payment of an amount equal to 0.125%.

The consent fee deadline was 11 a.m. ET on July 30.

Noteholders could continue to submit consent instructions after the consent fee deadline and up to 5 a.m. ET on Aug. 6, but they will not receive the consent fee.

Payment of the consent fee is expected to take place on Aug. 17.

Agents

HSBC Bank plc (+44 20 7992 6237, LM_EMEA@hsbc.com) and J.P. Morgan Securities plc (+44 20 7134 4353, liability_management_EMEA@jpmorgan.com) are acting as solicitation agents, and Lucid Issuer Services Ltd. (+44 20 7704 0880, heathrow@lucid-is.com) is acting as tabulation agent.

The issuer is the Hounslow, England, owner and operator of the Heathrow airport and the Heathrow Express.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.