2020.07.11(토)

전체기사

Hahn & Co to refinance debt borrowed for Coavis acquisition The PE firm seeks to refinance the acquisition debt to benefit from low interest rates

Translated by Kim So-in 공개 2020-06-03 08:00:27

이 기사는 2020년 06월 03일 08:00 더벨 유료페이지에 표출된 기사입니다.

Hahn & Company plans to refinance its loans originally taken out to finance the acquisition of South Korea’s auto parts maker Coavis in a move to take advantage of low interest rates.

Hahn & Co. which owns a controlling stake in Coavis has decided to refinance its acquisition debt for the company and started discussing the issue with arrangers including Woori Bank and Meritz Securities, according to sources on June 1. The size of the refinancing is reportedly 80 billion won ($65 million) which is similar to the size of its original loans. The expected interest rate is in the upper four percent range.

Previously, the debt borrowed for the auto parts maker acquisition was refinanced in 2017. The deal was led by Woori Bank while Hana Financial Investment and Samsung Securities participated as joint arrangers.

Established in 1994, Coavis is a leading automobile fuel pump module manufacturer serving the world's largest automakers. The size and profits of Coavis have grown after the PE firm’s buyout investment.

Hahn & Co. acquired a 66 percent stake in the company which was owned by former Coavis president Lee Hee-yeol via its first blind-pool fund in June 2012. In the following year, the PE firm took over the remaining stake from S&T Motiv. The company recorded sales of 152.3 billion won and operating profits of 7.3 billion won in 2011 on a consolidated basis. Its earnings before interest, taxes, depreciation, and amortization (EBITDA) stood at 13.3 billion won.

After acquired by the PE firm, Coavis’ sales increased by 21 percent and operating profits and EBITDA more than doubled. Coavis posted sales of 184.4 billion won and operating profits of 15.7 billion won on a consolidated basis last year. Its EBITDA was 29.6 billion won during the same period. This is attributable to Coavis’ network with top-tier automakers like GM and Volkswagen along with domestic automakers.

Changes are likely to occur in the composition of lenders except for Woori Bank which is set to arrange the latest refinancing deal. Of total 80 billion won, approximately 60 billion won has been raised including Woori Bank’s contribution of 45 billion won, and the remaining 20 billion is expected to be secured as early as next week.

(Reporting by Ar-rum Rho)
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