Cinram International Income Fund Completes US$337 Million Refinancing and Recapitalization
|Areas||Banking and Finance Law, Commercial Real Estate, Corporate Finance and Securities, Corporate Restructuring, REITs and Income Securities, Tax|
Goodmans represented Cinram International Income Fund (together with its subsidiaries where applicable, "Cinram" or "Cinram Fund") in connection with its completion of a US$337M refinancing and recapitalization transaction by achieving unanimous consent of its lenders to the transaction through an amendment process as well as the consent of a majority of the Fund’s unitholders. Cinram retained Goldman, Sachs & Co. to act as its financial advisor to assist the Fund in the transaction. The transaction involved the following key elements: (i) an amendment and extension of Cinram’s senior secured credit facility to December 31, 2013; (ii) a reduction in the amount of term debt outstanding by US$120 million through a cash paydown in the principal amount of US$30 million and an exchange of outstanding first-lien term debt in the amount of US$90 million for US$90 million second-lien secured debt that is mandatorily exchangeable into equity of the Fund on December 31, 2011 if not earlier repaid from equity proceeds; (iii) an option for Cinram to raise new equity proceeds to repay the mandatorily exchangeable secured debt through the end of 2011; (iv) the issuance of up to approximately 9.85 million Cinram units and a cash fee to lenders that consented to the transaction by a consent date; and (v) the issuance of warrants to acquire 13 million Cinram units. JPMorgan Chase Bank, N.A. continues as the Administrative Agent under the amended first lien credit facility and is the Administrative Agent under the mandatorily exchangeable second lien term loans. Cinram is one of the world’s largest providers of pre-recorded multimedia products and related logistics services, with facilities in North America and Europe.