Debt laden Chinese conglomerate HNA mulls refinancing cargo handler Swissport’s debt as sale stalls
- HNA, which bought Swissport for US$2.8 billion in 2015, had previously held talks to sell the division, according to people familiar with the matter
Swissport International, the airport-cargo handler owned by troubled Chinese conglomerate HNA Group, said it plans to refinance some of its outstanding debt amid stable earnings growth.
According to a statement by Swissport on Monday, its €1.6 billion (US$1.8 billion) refinancing comprises a new €75 million revolving credit facility, a €50 million delayed-draw loan facility, an aggregate principal amount of €1.23 billion across a new term loan facility, and an offering of €280 million in new euro-denominated senior notes.
The company plans to use about €712 million of the proceeds to fully repay existing term loan facilities, it said. It will deploy about €628 million to fully redeem outstanding existing notes of Swissport Financing issued in 2017.
Swissport reported a 3 per cent growth in revenue for the three months ended June 30, while its earnings were largely unchanged.
HNA, which bought Swissport for 2.73 billion Swiss francs (US$2.8 billion) in 2015, had previously held talks to sell the division to potential bidders including Brookfield Asset Management and Cerberus Capital Management, people familiar with the matter said as recently as October. The Chinese firm is working to sell billions of dollars in assets after an acquisition spree left it with one of the highest levels of corporate debt in China.
While the company’s debt refinancing is the main focus, a potential sale of the Swissport has not been ruled out, people familiar with the matter have said. A spokesman for HNA declined to comment.
Swissport, which also offers ticketing, cabin cleaning and aircraft maintenance, had previously been slated for an initial public offering before the sale consideration. The conglomerate decided to postpone the share sale last year, citing a volatile market.