Swissport has received a further $100 million (€83 million) repayment on its affiliate loan to HNA Group and has agreed to a temporary remedies standstill period.
The ground services provider said it will use funds from the repayment to prepay a portion of its own, existing term-loans, reducing its net debt position and significantly improving its leverage ratio.
Swissport has also received a further repayment of $100 million from HNA Group in partial satisfaction of HNA Group’s obligations under its outstanding affiliate loan owing to Swissport in the aggregate original principal amount of approximately €360 million which was due for repayment in full on 7 May 2018.
With this repayment, the outstanding balance of the affiliate loan will be reduced to approximately €286 million. In connection with the $100 million repayment, Swissport agreed to forbear from exercising remedies to collect the remaining unpaid balance under the Affiliate Loan for a period of five months. Swissport has received a forbearance fee of €150,000, included in the $100 million payment.
Swissport is applying funds from the repayment by HNA Group to prepay a rateable portion of its existing term-loans, including a portion of the term-loans that were used to partially finance the acquisition of Australian ground handling company Aerocare.
The acquisition was successfully completed on 7 March 2018, strengthening Swissport’s market position, especially in Asia Pacific, where it sees attractive prospects.
Swissport’s chief financial officer, Christian Goeseke said: “In line with our medium-term financial plan and just two months after successfully completing our strategic acquisition of Aerocare, we can make a first prepayment on Swissport’s existing term-loans. This significantly reduces our net debt.”
Swissport has agreed to forbear for a period of five month from exercising remedies to collect the remaining balance under the Affiliate Loan, due for repayment in full on 7 May 2018. Swissport continues to earn a market interest rate on the residual amount.
With the partial repayment from HNA Group, Swissport’s pro forma total net leverage will improve to roughly 5.04x from 5.37x as of 31 March 2018.