Northgate required to raise £100 million to secure new funding

By Lisa Kerner

Charlotte, N.C., July 10 - Northgate plc announced committed secured facilities of approximately £880 million comprised of new lending facilities and amended U.S. loan notes.

Proceeds of the advances under the financing will be used to refinance existing lending facilities, repay in part the U.S. loan notes and for general working capital, Northgate said.

Northgate is required to complete an equity fundraising of at least £100 million by Sept. 30 in order for the new lending facilities to become effective.

The new lending facilities carry a higher interest rate than the existing lending facilities and contain a dividend restriction.

According to Northgate, the coupon on the U.S. loan notes will also be increased.

Northgate is required to make three mandatory amortization payments of £30 million on Dec. 31, £40 million on June 30, 2010 and £40 million on Dec. 31, 2010.

A total of £31.3 million in fees and expenses is payable by Northgate in connection with the refinancing.

Based in Darlington, England, Northgate is a van rental company.

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