Agreement to wave requirement for chief shareholder FEFAM to conduct a full takeover paves way for shareholders to vote through a debt-for-equity swap that will reduce the historic battery maker’s debts by a reported 65% next Tuesday.
European battery manufacturer Leclanché’s debt restructuring plans have been helped along by the Swiss Takeover Board.
The Swiss authority yesterday announced it had agreed to exempt Leclanché’s major shareholder from a requirement to take over all of the historic company’s stock.
Chief shareholder FEFAM would typically be obliged to complete a full takeover of Yverdon-les-Bains-based Leclanché under the Swiss Takeover Board’s rules, because of the scale of the debt it is owed by the company that it wishes to convert into equity, as part of Leclanché’s bid to reduce its debt pile.
But the board announced yesterday FEFAM – an investment fund made of Luxembourg-registered sub funds AM Investment SCA, SICAV-SIF and two further sub funds of the Finexis Equity Fund, devoted to energy and e-money strategies – would be granted an exemption from the takeover requirement ahead of a Leclanché shareholder vote on the proposed restructuring, to be held at an EGM in a week’s time.
FEFAM finances expansion
Leclanché, which has been making batteries since 1909, announced in June it was investing in a 25% stake in a joint venture with India’s largest battery maker – Exide Industries – to establish a module and battery pack assembly line by the second quarter of next year and a lithium-ion cell production plant by mid 2020, with both thought to be earmarked for Gujarat.
In the meantime, FEFAM has had to provide significant backing for the venerable brand, reportedly following a CHF75 million ($75.4 million) injection with a CHF24 million debt for equity swap. It was reported in October that the chief shareholder would provide a further $76.7 million cash boost plus $50 million for M&A activity. October was also when plans for the latest, $55 million debt for equity swap were announced, with the aim of concluding the restructuring by the first quarter of next year.
Although earlier reports cited a plan to reduce Leclanché’s debts by 75% under the restructuring, yesterday’s announcement by the Swiss Takeover Board cited a figure of 65%.
Source PV Magazine