ABOUT THE GROUP RECAPITALISATION
The planned recapitalisation of Ascendis Health announced in January 2021 is aimed at reducing the group’s high levels of gearing and short-term maturity obligations as well as addressing the need for near-term funding. Importantly, the recapitalisation will enable Ascendis to create a sustainable capital structure.
In June 2020, Ascendis Health entered into an agreement with its lender consortium to restructure existing debt facilities and to provide for the advance of new facilities. This arrangement enabled the group to extend the repayment obligations on its debt to 31 December 2021.
This debt extension allowed management and the group’s operating companies to focus on driving performance. It also enabled the group to progress a lender-prescribed divestment programme aimed at maximising the exit values of assets targeted for disposal.
In January 2021, two members of the lender consortium, Blantyre Capital Limited (Blantyre) and L1 Health GP SARL (L1 Health), advised Ascendis they had collectively increased their exposure to more than 75% of the company’s debt.
Blantyre and L1 Health advised that they did not believe that the divestment of core assets being undertaken by Ascendis was in the best long-term interests of the company and its stakeholders. These lenders proposed a recapitalisation to allow the group to reduce debt levels and provide funding to maximise the long-term strategic value of the business.
Negotiations with Blantyre and L1 Health
The Ascendis board and management entered into consensual negotiations with Blantyre and L1 Health on recapitalising the company. This transaction is likely to be implemented by way of the discharge of outstanding debt in exchange for interests in the group’s operating subsidiaries. The parties aim to reach agreement on the transaction structure by 30 April 2021. Kindly address any questions on the group’s recapitalisation to firstname.lastname@example.org