GERMANY/UK- PAI struggles to reach agreement with Monier Group's lenders

Deborah
13 May 2009

Tweet
Facebook
LinkedIn
Google plus
Send to

Private equity group PAI Partners is reportedly being challenged for its stake in German-based building materials company Monier Group (formerly Lafarge Roofing) by a group of distressed debt investors.

Lenders to the troubled business turned down PAI's proposed debt-for-equity swap, which would have given them a 24% stake in the company in exchange for a slash in debt from €1.7bn to €600m; reportedly wanting a larger stake in the company for the amount of debt being written off.

It has been reported that a formal counter offer is expected soon and that Apollo Management, TowerBrook Capital and York Capital, which own about 40% of Monier's debt, made an informal alternative offer last week.

The company has until June 30 to make its interest payment and is thought to be possibly breaching covenants after a sharp decline in its EBITDA.

In 2006, PAI backed the buyout of Monier Group in a deal valued at €2.4bn, while Lafarge retained a 35% stake in the business. BNP Paribas and JP Morgan provided €1.67bn of senior debt and €300m of second lien debt to support the deal.