Fisher & Paykel thrown $80 million lifeline

Leading New Zealand appliance maker Fisher & Paykel Appliances has secured a lifeline from banks until April 30.

The company said today it had established an interim $80 million funding facility and negotiated a waiver of the group's debt cover ratio and interest cover ratio covenants as at March 31 for the term of the interim facility.

It said media reports that an announcement of a new cornerstone shareholder was imminent were not correct.

The facility will meet "temporary peak funding requirements".

The company hoped to refinance its total bank debt by April 30.

The new interim facility is repayable on April 30 but the parties can agree to a later date.

The company's banks have agreed to move to joint decision-making across all of the bank facilities for the term of the interim facility.

The company's move of manufacturing facilities offshore has increased its debt.

Its debt, including draw downs under this new facility, was projected to be $570m at March 31.

"Our relationship with our banking syndicate is such that we have been able to move quickly with them to establish this interim facility and a structure for ongoing discussions around a restructuring of all of the debt of the appliances group," said chief executive John Bongard.

He said the interim facility was sufficient for the group's immediate funding needs.

The facility was secured against assets, which were not detailed. The facility will be repaid when total bank debt is refinanced.

Fisher & Paykel Appliances shares were trading at 51c today, down from $2.75 in May last year.

- NZPA