Bakery and convenience food group IAWS boosted its available borrowing facilities yesterday by raising $450 million (€338 million) in debt from US and UK financial institutions.
The money will be used to refinance part of the €950 million debt it put in place to fund the €450 million purchase of US baker Otis Spunkmeyer last October, and for further investment in its North American operations.
In a statement yesterday, the company said it had placed $450 million in senior loan notes with US and UK institutions. The debt carries an average interest rate of 5.82 per cent and must be repaid on dates between 2014, 2017 and 2019. Interest will be payable twice a year.
"The proceeds of the placement will refinance and lengthen the maturity profile of a portion of the group's existing borrowing facilities," the statement said.
IAWS recently cashed in about €265 million when it spun off Origin Enterprises, the vehicle that included its property interests, animal feed and fertiliser supplies business, and Shamrock Foods.
Commenting on yesterday's announcement, finance director Patrick McEniff said the debt placement and the release of €265 million from Origin Enterprises had considerably strengthened the group's balance sheet.
Last October's purchase of Otis Spunkmeyer was the biggest in IAWS's history. At the time, the group said it had put in place €950 million in debt to cover the €450 million purchase price and associated costs. It had €150 million left following the deal.
