Norges Statsbaner amends bid to switch Materiellselskapet as issuer

By Susanna Moon

Chicago, Nov. 9 – Norges Statsbaner AS has received votes so far to amend about NOK 3.6 billion equivalent principal amount of a number of its notes in its bid to substitute Materiellselskapet AS as the issuer and principal debtor.

Statsbaner increased the early consent fee to 0.2% and extended the early consent deadline to 11 a.m. ET on Nov. 10, according to a company announcement.

Before the change, holders who provided consent instructions in favor of the measure by 11 a.m. ET on Nov. 4, the original early consent date, would have received payment of 0.1%.

The consent solicitations will end at 11 a.m. ET on Nov. 10.

The issuer will hold meetings on Nov. 15 to ask approval to pass the amendments.

The new issuer also confirmed that a preliminary rating of A+ has been given to the new issuer and the notes by S&P, the release noted.

As of Wednesday, “significant” noteholders have agreed to give their consents in the solicitation. They hold in aggregate about 56% principal amount outstanding of the NOK 400 million 3.1% notes due April 2019, about 55% principal amount outstanding of the NOK 300 million 3.08% notes due February 2021, about 49% principal amount outstanding of the NOK 350 million 4.25% notes due January 2022 and 100% principal amount outstanding of the NOK 500 million 3.75% notes due February 2026.

As announced Oct. 24, Norway’s national railway is seeking to amend its

• CHF 250 million 2.125% notes due February 2020;

• CHF 125 million 1.125% notes due May 2023;

• NOK 600 million floating-rate notes due February 2019;

• NOK 400 million 3.1% notes due April 2019;

• NOK 300 million floating-rate notes due April 2019;

• NOK 300 million 3.08% notes due February 2021;

• NOK 350 million 4.25% notes due January 2022;

• NOK 500 million 3.75% notes due February 2026; and

• NOK 1.15 billion 4.625% notes due January 2027.

The issuer substitution is in connection with an asset purchase agreement on Oct. 14 between the existing issuer and the new issuer.

The rolling stock owned by the existing issuer and some employees were transferred to the new issuer on Oct. 15 under the terms of the asset purchase agreement. In return for the rolling stock and other rights, assets and liabilities taken over by the new issuer, the new issuer has agreed to assume the obligations of the existing issuer under the notes, and they entered into a lease contract in which the existing issuer leases back the rolling stock transferred to the new issuer.

The existing issuer has been responsible for procuring its own rolling stock and has acquired its rolling stock after extensive competitive tendering under the Norwegian Public Procurement Act.

The rolling stock “was developed specifically for the Norwegian rail system and climate, represents a significant investment and has a long remaining useful life, and therefore represents a potential barrier to entry for new train operators in the Norwegian passenger rail market,” the release noted.

“To reduce entry barriers and ensure competition for passenger train services on equal terms,” the Ministry of Transport decided to transfer the rolling stock to the new issuer and ordered that it be made available to the train operators that win the tenders for the traffic packages.

The initial step under a proposed reform has been the internal reorganization of the companies and business sectors within the existing issuer.

The new issuer is targeting a long-term debt rating of A+ from S&P, with a current rating of A+ with a negative outlook depending on the outcome of the reform. In the longer term, the new issuer expects a long-term debt rating of AA, the release noted.

The consent solicitation is only being made to holders who are non-U.S. persons under Regulation S.

Barclays Bank plc (+44 20 3134 8515 or eu.lm@barclays.com) is the solicitation agent. D.F. King Ltd. (+44 20 7920 9700, nsb@dfkingltd.com or https://sites.dfkingltd.com/nsb) is the global information agent and Swiss tabulation agent. Nordic Trustee ASA is the VPS tabulation agent.

Norges Statsbaner, trading as NSB AS and known in English as the Norwegian State Railways, is a government-owned railway company based in Oslo.

© 2015 Prospect News.
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