Corporate bonds

Ekosem-Agrar plans to extend and cut corporate bond interest rates

DGAP-News: Ekosem-Agrar AG / Keyword(s): Bond/Financing
05.04.2022 / 15:03
The issuer is solely responsible for the content of this announcement.

Ekosem-Agrar plans to extend and cut corporate bond interest rates

  • Effects of Sanctions, Rising Key Rates and Currency Risks on Business Performance Currently Unforeseeable

  • Management assumes that the planned refinancing of the 2012/2022 bond via the capital market will not be possible in the foreseeable future

  • 5-year extension as well as reduction of interest rates to 2.5% per annum and qualified subordination of the interest payments scheduled for the two bonds

  • Waiver of the reimbursement option in the event of the sale of operating subsidiaries to deal with a possible expropriation or a ban on the financing of foreign companies

  • Invitation to the general meetings of May 9 and 10, 2022 in Sinsheim published in the Federal Gazette and on the company’s website

Walldorf, April 5, 2022 – Ekosem-Agrar AG, the German holding company of Russian milk producer Ekoniva Group, has decided to offer bondholders to each extend the 2012/2022 bearer bonds (ISIN: DE000A1R0RZ5) and the five-year bearer bonds 2019/2024 (ISIN: DE000A2YNR08) and to reduce the interest rate from 8.5% per annum and 7.5% per annum respectively to 2.5% per annum for the two bonds (with retroactive effect from the date of payment of the last respective interest). The redemption of the Ekosem-Agrar 2012/2022 bond loan and the Ekosem-Agrar 2019/2024 bond loan would then take place respectively on December 7, 2027 and August 1, 2029. Bondholders will also be invited to a qualified subordination interest payments in order to avoid risks arising from the dynamic evolution of the regulatory situation, but also from unpredictable economic developments. In addition, the company will ask the noteholders to waive the redemption option in the event of the sale of the shares of the Russian operating companies (change of control). This is important because in the event of an impending expropriation, financing ban or other potential restrictions for foreign companies, the company could only avoid a total loss of assets by selling its shares to a company based in Russia. Such measures have already been discussed and enacted in Russia for certain cases. The company believes it is necessary to prepare for such an event in the interest of its noteholders.

Wolfgang Bläsi, CFO of Ekosem-Agrar AG: “The political and economic developments of recent weeks, including the sanctions imposed on Russia and the Russian counter-sanctions, will have a massive impact on future financing options and costs The range and reliability of forecasts is extremely limited and we do not expect this to change much in the foreseeable future, so we have no choice but to extend both bonds on modified terms in order to maintain our company’s flexibility and protect noteholders as best as possible.”

Stefan Dürr, Chairman of the Management Board and main shareholder of Ekosem-Agrar AG: “The current situation was impossible for us to predict. For more than 20 years, our company has stood symbolically for successful German-Russian cooperation and fruitful dialogue. and the transfer of knowledge between our countries. This makes us all the more concerned about the latest escalation of the Russian-Ukrainian conflict and the suffering of millions associated with it. We hope for a quick peaceful resolution and a quick return to dialogue.

Ekosem Group has experienced profitable growth in recent years. It is the leading producer on the Russian market of raw milk, a major manufacturer of dairy products and one of the world’s top 3 producers of raw milk. Financing via a total of three corporate bonds on the German capital market made a significant contribution to this successful development. The first 2012/2021 corporate bond issue was repaid as scheduled at final maturity in March 2021. The refinancing of the 2012/2022 bond issue, which matures in December 2022, was scheduled after the closing of the 2020 accounts during the year. Management and its financial advisers believe that this will no longer be possible. Due to the current political and economic uncertainty, the audit of the 2020 financial statements, which were finalized after the fundamental agreement with the main lending bank in Russia, cannot be completed at this time. The company is in close contact with the auditor to complete the process as soon as the market situation allows.

The company wishes to inform its bondholders of the context and of the necessary adaptation of the terms and conditions of the two bonds and, in this respect and for the purposes of the adoption of resolutions, invites them to a meeting of bondholders in Sinsheim on May 9, 2022 for the bearer bonds 2012/2022 (ISIN: DE000A1R0RZ5) and May 10, 2022 for bearer bonds 2019/2024 (ISIN: DE000A2YNR08).

The invitations for the respective bond, including the agenda and general information about the proposed resolution, were published today in the Federal Gazette and are available on the website of Ekosem-Agrar AG together with the forms required for registration https://www.ekosem-agrar.de/en/investor-relations/.

Invitation to the investor conference call (German language)

In order to further explain the current situation and the proposed resolutions, the Management Board invites all noteholders to a conference call with investors on Thursday April 7, 2022, at 11:00 a.m. (CEST). The joint representative for the bond loan 2019/2024, e.Anleihe GmbH, together with managing director Christoph Chardon, who was also proposed by the company as joint representative for the bond loan 2012/2022, will also benefit from the conference call to introduce themselves. to noteholders.

To register for the conference call, interested ticketholders should send an e-mail to [email protected] and are asked to prove their status as ticketholders by means of a securities account statement.

The conference call for investors will be held in German. Ticket holders who do not speak German are welcome to contact us directly by e-mail ([email protected]), if they have any questions.

About Ekosem-Agrar
Ekosem-Agrar AG, Walldorf, is the German holding company of the EkoNiva Group, one of Russia’s largest agricultural companies. A herd of more than 216,000 head of cattle (including more than 112,000 dairy cows) and a daily production of approx. 3,100 tons of raw milk make the company the largest milk producer in the country. The Group controls an agricultural area of ​​approx. 630,000 hectares and is also one of Russia’s leading seed producers. The company’s founder and CEO is Stefan Dürr, who has been active in Russia’s agricultural sector since the late 1980s and has been instrumental in modernizing the industry over the past three decades. In 2009, he was awarded the Order of Merit of the Federal Republic of Germany in recognition of his contribution to the German-Russian dialogue on agriculture. The Group employs some 12,000 people and is present in nine administrative areas in Russia. Ekosem-Agrar generated total production of €565 million and adjusted EBITDA of €167 million in 2019.

Contact Ekosem-Agrar
Irina Makey // Ekosem-Agrar AG // Johann-Jakob-Astor-Str. 49 // 69190 Walldorf // Tel: +49 (0) 6227 3585 919 // E: [email protected]

Press / Investor Relations
Fabian Kirchmann, Anna-Lena Mayer // IR.on AG // T: +49 (0) 221 9140 970 // E: [email protected]

05.04.2022 Broadcast of a Corporate News, transmitted by the DGAP – a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

DGAP distribution services include regulatory announcements, financial/corporate news and press releases.
Archive at www.dgap.de