Safilo Announces New Term Loan Facility of €108 Million

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PADUA, Italy—Safilo Group has announced the signing of a new Term Loan Facility for €108 million (127,944,900 USD) to provide Safilo with additional liquidity in order to finance working capital and investment needs for its activities located in Italy. Safilo reports that SACE will guarantee 90 percent of the new amount borrowed, pursuant to the “Decreto Liquidità” adopted on April 8, 2020 by the Italian Government and converted into law by the Parliament, in the context of the extraordinary measures promoted to deal with the economic and social impact of the Covid-19 outbreak.

Arranged by BNP Paribas, ING Bank, Intesa Sanpaolo and UniCredit, also acting as SACE Coordinator and Agent Bank, the new Term Loan Facility (the SACE TLF) matures on June 30, 2026, with three years’ grace period for a repayment profile in 12 quarterly instalments starting from September 2023. The facility is unsecured and “pari passu” with the €150 million Term Loan and Revolving Credit Facility (the “2018 TLRCF”) signed in 2018.

The overall cost of this financing, also thanks to the guarantee issued by SACE, is lower than the current cost of the Group’s debt, Safilo reports. The SACE TLF contains the specific representations and undertakings required by the “Decreto Liquidità,” along with others customary for this kind of transaction, and the possibility for the Company to cure potential future breaches of financial covenants through new subordinated loans which, upon request of the lenders, the company has undertaken to negotiate and obtain from HAL, Safilo Group’s reference shareholder through Multibrand Italy B.V., if ever needed over the duration of the financing and up to a maximum amount of €30 million.

In the context of the SACE TLF, the Company and its lenders have agreed on an amendment of certain provisions of the 2018 TLRCF, including the cancellation of the covenant test as of June 30, 2020 and a new set of covenants starting from Dec. 31, 2020, in accordance with the terms of the SACE TLF.

In order to close the new SACE TLF and amend the 2018 TLRCF, Safilo’s board of directors further approved, upon request of the lenders and the opinion of the Related Parties Committee, certain amendments to the financing agreement of €90 million entered into between Safilo and Multibrands Italy B.V on Feb. 6, 2020, including, among others, its subordination to the SACE TLF, in addition to the already provided subordination to the 2018 TLRCF, the extension of its maturity from June 30, 2023 to Dec. 31, 2026 and some consistency amendments such as the same covenants package of the banks’ financing agreements.

The information document relating to the aforementioned loan of €90 million, published on Feb. 13, 2020, as canceled and replaced on April 23, 2020, will be updated and made available within the time frame provided for by the law.