Lenders Set To Make Takeover Bid for Monier

LONDON (Reuters) – Lenders to Monier Group are poised to launch a takeover bid for the company before a looming debt deadline at the end of June, three sources with knowledge of the situation said on Monday.

Monier’s current owner, PAI, is battling lenders for control of the heavily indebted French roofing company, a situation which must be resolved before an end-June loan covenant test and interest payment.

“This is a battle royale between the sponsor and the lenders. It is edge of the seat stuff and a fascinating duel,” a Monier investor said.

The steering committee of lenders are working with a consortium of distressed debt investors — Apollo Management [APOLO.UL], TowerBrook Capital and York Capital — on the rival debt-for-equity proposal, two of the sources said.

“The lender-led group which is the steering committee and the distressed consortium are trying to come up with an agreed solution which is the desired outcome from the lenders,” the investor said.

All parties involved in the company’s debt are keen to resolve the ownership of the firm before the June 30 deadline, two of the sources said.

PAI has offered a debt for equity deal that includes the injection of new money onto the company’s balance sheet in return for cutting around 1 billion euros ($1.4 billion) from Monier’s 1.7 billion debt load, a second source said.

The lender-led group own around 20 percent of the senior debt and have the support of around 30 top lenders representing 50 percent of senior debt, giving the consortium a total of around 70 percent of senior debt, the investor said.

“Everyone is now waiting for the lenders’ offer which is expected to arrive sometime this week,” a third source said.

Monier’s management could play a decisive role in determining the fate of their company, as both sides need support of senior management to drive a deal through, the investor said.

“The management is key here, hopefully they will behave in a neutral manner,” he said.

Neither Monier, PAI nor the distressed debt investors could be reached for comment.

By Tom Freke and Tessa Walsh

(Editing by Dan Lalor) ($1 = 0.7230 euro)