SAN JOSE, Calif.–(BUSINESS WIRE)–Lumileds Holding B.V. (“Lumileds” or the “Firm”), a world chief in progressive lighting options, introduced right now that it has entered right into a restructuring assist settlement (the “RSA” or the “Settlement”) with its lenders holding a big majority of the loans excellent below its prepetition first lien debt facility on the phrases of a complete monetary restructuring that might considerably de-leverage and strengthen its stability sheet by over $1.three billion, speed up Lumileds’ development, and allow additional funding in innovation to pursue extra strategic alternatives via the injection of as much as $275 million of liquidity.
To effectively implement the de-leveraging, a narrowly targeted prepackaged Chapter 11 plan (the “Plan”) involving solely Lumileds’ U.S. and Dutch entities has commenced within the U.S. Chapter Courtroom for the Southern District of New York (the “Courtroom”). Lumileds’ European, Asian, and different overseas subsidiaries and associates usually are not included within the submitting and are unaffected by the Chapter 11 course of. The Firm has obtained the required assist from its lenders to substantiate the Plan previous to commencing its proceedings and expects to fulfill the necessities to substantiate the Plan and emerge from Chapter 11 inside roughly sixty days.
“Over the previous few years, we have now been arduous at work remodeling our value construction and innovation pipeline, which has allowed us to capitalize extra successfully on future market tendencies as a pacesetter within the lighting business,” mentioned Matt Roney, CEO of Lumileds. “We now have proactively taken steps to de-leverage our stability sheet given the continued challenges offered by international provide constraints, COVID-related points, and the disaster in Ukraine. This recapitalization will allow us to additional speed up our efforts as a market-leading innovator throughout the specialty lighting business. We imagine that the simplest and environment friendly solution to accomplish that is via a prepackaged Chapter 11 course of that will probably be accompanied by a big improve in our liquidity place. We recognize the assist of our lenders, who acknowledge the long-term worth and enhanced potential Lumileds will create with a strengthened stability sheet.”
BUSINESS AS USUAL
Not one of the Firm’s enterprise operations outdoors of america and the Netherlands are a part of the Chapter 11 continuing. The Firm has filed “first day” motions to acquire the requisite court docket authority for the Firm to proceed working its companies and amenities within the strange course with out disruption to its clients, distributors, suppliers, or staff. As a part of these first day motions, the Firm has sought court docket approval to proceed to pay all legitimate quantities owed to distributors and suppliers as they arrive due. As well as, the Firm expects that staff will proceed to obtain their ordinary wages and advantages with out interruption.
“Our primary precedence is to ship by no means earlier than attainable options for lighting, security, and well-being,” added Mr. Roney. “This complete liquidity and de-leveraging answer will allow us to be an much more engaging and stronger accomplice as we proceed to drive innovation in LED expertise and provide new merchandise and options to our clients. I want to thank all of our valued staff, clients, distributors, suppliers, and sponsors for his or her ongoing assist.”
TERMS OF THE RESTRUCTURING SUPPORT AGREEMENT
Underneath the phrases of the RSA, the prevailing secured lenders are anticipated to decide to assist, and vote in favor of, a transaction that, when executed, will scale back the Firm’s funded debt by roughly $1.three billion, from roughly $1.7 billion to $400 million comprised of takeback debt and post-petition loans, which will probably be mixed right into a 5-year exit facility.
The RSA additionally contemplates a dedication from sure of its lenders of as much as $275 million in debtor-in-possession (“DIP”) financing, obtainable as a part of the Chapter 11 course of. Topic to the Courtroom’s approval, the DIP financing, along with the Firm’s obtainable money reserves and money supplied by operations, is anticipated to supply enough liquidity for Lumileds to proceed assembly its ongoing obligations, together with all obligations to clients, distributors, and suppliers, in addition to worker wages, salaries, and advantages packages.
Extra details about Lumileds’ restructuring, together with entry to Courtroom paperwork, will probably be obtainable at https://dm.epiq11.com/Lumileds or by contacting Epiq Company Restructuring, LLC, the Firm’s noticing and claims agent at +1 800-497-9116 (for toll-free home calls) and +1 503-520-4495 (for tolled worldwide calls) or emailing Lumiledsinfo@epiqglobal.com.
Evercore is appearing as funding banker for the Firm; Paul, Weiss, Rifkind, Wharton & Garrison, LLP, and Latham & Watkins LLP are appearing as company and restructuring counsel to Lumileds, and AlixPartners, LLP, as monetary advisor. PJT Companions is appearing as monetary advisor for an advert hoc group of Lumileds’ lenders, and Gibson, Dunn & Crutcher LLP is appearing because the group’s authorized counsel.
About Lumileds
Lumileds is a world chief in OEM and aftermarket automotive lighting and equipment, digicam flash for cell gadgets, MicroLED, and lightweight sources for basic illumination, horticulture, and human-centric lighting. Our roughly 7,000 staff function in over 30 nations and accomplice with our clients to ship by no means earlier than attainable options for lighting, security, and well-being. To be taught extra about our firm and answer portfolios, please go to https://lumileds.com.
Sure statements on this press launch are forward-looking statements throughout the that means of and made pursuant to the secure harbor provisions of Part 27A of the Securities Act of 1933, as amended, and Part 21E of the Securities Alternate Act of 1934, as amended. As well as, our administration might, once in a while, make forward-looking oral statements. All statements, apart from statements of historic info, are forward-looking statements. Ahead-looking statements could also be recognized by the phrases “imagine,” “count on,” “anticipate,” “challenge,” “plan,” “estimate,” “might,” “will,” “may,” “ought to,” “search” or “intend” and related expressions. Ahead-looking statements mirror our present expectations and assumptions concerning our enterprise, the financial system, and different future occasions and situations and are based mostly on at the moment obtainable monetary, financial, and aggressive information and our present enterprise plans. Precise outcomes may fluctuate materially relying on dangers and uncertainties that will have an effect on our operations, markets, providers, costs, and different elements. Whereas we imagine our assumptions are cheap, we warning you in opposition to counting on any forward-looking statements as it is vitally tough to foretell the impression of recognized elements, and it’s unattainable for us to anticipate all elements that would have an effect on our precise outcomes. Necessary elements that would trigger precise outcomes to vary materially from these within the forward-looking statements embrace, however usually are not restricted to, our capability to acquire the approval of the Chapter Courtroom with respect to motions filed within the Chapter 11 circumstances and the outcomes of Chapter Courtroom rulings and the Chapter 11 circumstances typically, the effectiveness of the general restructuring actions pursuant to the Chapter 11 filings and any extra methods that we might make use of to handle our liquidity and capital sources, the actions and choices of collectors, regulators and different third events which have an curiosity within the Chapter 11 circumstances, restrictions on us as a result of phrases of any debtor-in-possession credit score facility that we might enter into in reference to the Chapter 11 circumstances and restrictions imposed by the Chapter Courtroom, the timing for resolving and any impression of the community safety incident, a weakening of world financial and monetary situations, interruptions within the provide of or elevated value of uncooked supplies, the lack of, or difficulties with the additional realization of, value financial savings in reference to our strategic initiatives, the impression of our substantial indebtedness, our failure to adjust to monetary covenants below our credit score amenities or different debt, pricing actions by our opponents that would have an effect on our working margins, modifications in governmental rules and associated compliance and litigation prices, and the opposite elements. All forward-looking statements are expressly certified of their entirety by this cautionary discover. The forward-looking statements made by us converse solely as of the date on which they’re made. Elements or occasions that would trigger our precise outcomes to vary might emerge once in a while. We undertake no obligation to publicly replace or revise any forward-looking assertion on account of new data, future occasions or in any other case, besides as in any other case required by legislation.
