Ardagh Group S.A. provides an update on discussions with noteholders

LUXEMBOURG, April 7, 2025 /PRNewswire/ -- On 11 March 2025, Ardagh Group S.A. ("AGSA" or the "Company") announced that it is engaging in negotiations with certain holders of its Senior Secured Notes ("SSNs") and Senior Unsecured Notes ("SUNs") who comprise two separate ad hoc groups of AGSA's debt. A group owning a majority of the SUNs are represented by Akin Gump Strauss Hauer & Feld LLP and PJT Partners ("SUN Group"). Another group owning a majority of the SSNs are represented by Gibson, Dunn & Crutcher LLP and Perella Weinberg Partners ("SSN Group").

The Company continues to engage in constructive discussions with the SUN Group and the SSN Group regarding the terms of a potential restructuring transaction.

As an update to the announcement on 11 March 2025, the latest proposal received from the SSN Group (the "SSN Proposal") includes the following key terms for a transaction:

• a potential divestment (subject to AGSA board approval) of the ordinary shares in Ardagh Metal Packaging S.A. ("AMP Shares") to a new special purpose vehicle holding structure ("New BidCo") owned by existing indirect shareholders of AGSA (the "Existing Shareholders") and by participating holders of the SUNs. The existing preferred equity issued by Ardagh Metal Packaging S.A. to AGSA's subsidiary, Ardagh Investments Holdings Sarl's ("AIHS") would remain at AIHS;
• at completion, the pro forma equity in New Bidco would be held 80% by the Existing Shareholders and 20% by holders of the SUNs (subject to an allocation to participating holders of the senior secured toggle notes due 2027 issued by ARD Finance S.A. (the "PIK Notes")), with pro-rata allocation based on participation rate;
• the exchange of the SSNs into (i) up to $1,892 million of new senior secured debt at AGSA, which would have second-out priority in respect of proceeds from security enforcement, would mature in June 2030, bear interest at 6.0% cash and 6.0% PIK interest, and have call protection of NC2, 50%, 25%, Par (the "AGSA Exchange SSNs"); and (ii) $600 million of new first lien senior secured debt at New BidCo, which would be backstopped by the Steering Committee of the SSN Group with a 5.0% backstop fee payable in kind, have security granted over substantially all the assets of New Bidco, would mature in June 2030, bear 12.0% cash interest, and have call protection of NC2, 50%, 25%, Par (the "New Bidco Debt");
• participating SSN holders would agree to provide the Company with basket capacity available through August 2026 maturity for the incurrence of new debt that would rank the same as the AGSA Exchange SSNs to facilitate a refinancing of non-participating SSNs with the AGSA Exchange SSNs benefitting from a "most favoured nations" clause in relation to the terms of the new debt issued or exchanged via this basket;
• existing holders of SSNs would be entitled to participate in a $1,200 million super senior new money facility at AGSA (the "AGSA New Money"), which would have first-out priority in respect of proceeds from security enforcement. $400 million would be applied towards general corporate purposes and $800 million would be applied towards the refinancing of AIHS's existing term loan facility (the "AIHS Facility"). The facility would mature in January 2030 (with a springing maturity), have call protection of NC2, 50%, Par, bear 9.0% cash interest, and would be backstopped by the Steering Committee of the SSN Group;
• participating SUNs would exchange pro rata into (i) new debt at AGSA, which would have third-out priority in respect of proceeds from security enforcement, mature in June 2030 with a springing maturity, bear 12.0% PIK interest, and have call protection of NC2, 50%, 25%, Par (except on conversion) (the "AGSA Exchange SUNs"); and (ii) $511 million of a new preferred equity instrument issued by New BidCo which would be subject to a mandatory redemption offer obligation in June 2030 (the "New Bidco Pref B"). Participating SUN holders would also receive a 7.5% upfront fee paid in the form of additional AGSA Exchange SUNs;
• participating holders of PIK Notes would exchange into new debt at AGSA which would have fourth-out priority in respect of proceeds from security enforcement, mature in June 2030 with a springing maturity, bear 12.0% PIK interest, and have call protection of NC2, 50%, 25%, Par (except on conversion) (the "AGSA Exchange PIKs");
• the AGSA Exchange SUNs and AGSA Exchange PIKs would be convertible into AGSA equity subject to an agreed participation threshold by participating SUN and PIK Notes;
• the consideration for the sale of the AMP Shares to New Bidco would comprise: (i) $600 million of SSNs being exchanged into the New Bidco Debt, (ii) a $763 million new preferred equity instrument issued by New BidCo to AGSA's subsidiary, AIHS, which would be subject to a mandatory redemption offer obligation in June 2030 and pay a dividend at an annual rate of 14.15% in cash or, on up to three dividend payment dates on which available cashflow is insufficient to pay such dividend in cash, in kind (the "New Bidco Pref A"), (iii) the partial exchange of SUNs into $511 million of the New Bidco Pref B. Existing Shareholders would also receive $57 million of New BidCo Pref B; and
• the collateral for the AGSA Exchange SSNs, the AGSA Exchange SUNs, the AGSA Exchange PIKs and the AGSA New Money would be the same collateral as per the existing SSNs plus security over certain currently unpledged assets including over the Ardagh Glass Packaging Africa group (directly or indirectly), AGSA's equity interests in the Trivium group, the New Bidco Pref A, and other assets where practicable.

After receiving the SSN Proposal, the Company shared a proposal with the SSN Group including the following key terms for a transaction:

• a potential divestment (subject to AGSA board approval) of the AMP Shares and the preferred equity in AMP currently held indirectly by AGSA to New BidCo (together with the AMP Shares, the "AMP Interests");
• at completion, the pro forma equity in New Bidco would be held 80% by the Existing Shareholders and 20% by holders of the SUNs, with pro-rata allocation based on participation rate;
• the exchange of the SSNs into (i) $1,892 million of new senior secured debt at AGSA, which would have second-out priority in respect of proceeds from security enforcement, would mature in June 2030 (with a springing maturity), would bear interest at an annual rate of 9.0% (4.0% cash; 5.0% PIK), and would have no call protection (the "Company AGSA Exchange SSNs"); and (ii) $600 million of new first lien senior secured debt at New BidCo, which would have security granted over substantially all the assets of New Bidco, would mature in June 2030, and would bear 6.25% cash interest, subject to the ability to pay in kind to the extent New BidCo were to have insufficient cash flow and would have no call protection (the "Company New Bidco Debt"). The exchange of SSNs into the Company New Bidco Debt would be backstopped by the Steering Committee of the SSN Group and (only in the case of a transaction with the consent of the SUN Group) the SUN Group with a 5.0% backstop fee payable kind. Non-participating SSNs would be left outstanding on their current terms;
• participating SSN holders would agree to provide the Company with basket capacity for the incurrence of new debt that would rank the same as the AGSA Exchange SSNs to facilitate a refinancing of non-participating SSNs, with the Steering Committee of the SSN Group benefitting from a right of first refusal in relation to the new debt issued or exchanged via this basket;
• existing holders of SSNs would be entitled to participate in a $1,210 million super senior new money facility at AGSA (the "Company AGSA New Money"), which would have first-out priority in respect of proceeds from security enforcement. $400 million would be applied towards general corporate purposes, $800 million would be applied towards the refinancing of the AIHS Facility, and $10 million would be applied towards funding New BidCo's balance sheet. The facility would mature in January 2030 (with a springing maturity), have call protection of NC2, 50%, Par, (only in the case of a transaction with the consent of the SUN Group), bear 8.5% cash interest, and would be backstopped by the Steering Committee of the SSN Group and (only in the case of a transaction with the consent of the SUN Group) the SUN Group in case of their later participation in the transaction;
• participating SUNs would exchange pro rata into (i) new debt at AGSA, which would be pari passu to existing SUNs, would mature in June 2030 (with a springing maturity), and bear 12.0% PIK interest (the "Company AGSA Exchange SUNs"); and (ii) $511 million of a new preferred equity instrument issued by New BidCo which would be subject to a mandatory redemption offer obligation in June 2030 and pay a cash dividend of 12.5%, subject to the ability to pay in kind to the extent New BidCo were to have insufficient cash flow (the "Company New Bidco Pref B"). Participating SUN holders would also receive a 20.0% fee paid in the form of additional Company AGSA Exchange SUNs;
• the Company AGSA Exchange SUNs would be convertible into AGSA equity on terms to be agreed;
• consideration to be provided to holders of PIK Notes to be agreed;
• the consideration for the sale of the AMP Interests to New Bidco would comprise: (i) $600 million of SSNs being exchanged into the Company New Bidco Debt, (ii) $1,023 million of a new preferred equity instrument being issued by New BidCo to AIHS, which would be subject to a mandatory redemption offer obligation in June in 2030 and pay a cash dividend of 9.4% (subject to the ability to pay in kind to the extent New BidCo were to have insufficient cash flow) (the "Company New Bidco Pref A"), and (iii) the partial exchange of SUNs into $511 million of the Company New Bidco Pref B. Existing Shareholders would also receive $57 million of Company New BidCo Pref B; and
• the collateral for the Company AGSA Exchange SSNs and the Company AGSA New Money would be the same collateral as per the existing SSNs plus security over certain currently unpledged assets including over the Ardagh Glass Packaging Africa group (directly or indirectly), the Company New Bidco Pref A, AGSA's equity interests in the Trivium group and other assets where practicable.

The Company will provide further updates in due course.

Disclaimer

This release does not constitute an offer to sell or the solicitation of an offer to buy any securities, nor will there be any sale of securities referred to in this announcement, in any jurisdiction, including the United States, in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. Securities may not be offered or sold in the United States absent registration under the U.S. Securities Act of 1933, or an exemption from registration.

This release contains "forward-looking" information. The forward-looking information is based upon certain assumptions about future events or conditions and is intended to illustrate hypothetical results under those conditions. Actual events or conditions are unlikely to be consistent with, and may materially differ from, those assumed. Any views or opinions expressed in this release (including statements or forecasts) constitute the judgement of the Company as of the date of this material and are subject to change without notice. You are cautioned not to place undue reliance on any forward-looking information.

Any projections or forecasts in this release are illustrative only and have been based on the estimates and assumptions when the Company's business plan was prepared. Such estimates and assumptions may or may not prove to be correct. These projections do not constitute a forecast or prediction of actual results and there can be no assurance that the projected results will actually be realized or achieved. Actual results may depend on future events which are not in the Company's control and may be materially affected by unforeseen economic or other circumstances.

Contacts: Investor Relations Contact: investors@ardaghgroup.com, Media: Pat Walsh, Murray Consultants, Tel.: +353 1 498 0300 / +353 87 2269345, Email: pwalsh@murraygroup.ie, Conor McClafferty, Conor.McClafferty@fgsglobal.com 

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SOURCE Ardagh Group S.A.