AIT hammers out refinancing agreement
01 August 2002 | 3977 views | 0
Embattled AIT Group has agreed terms for the take up of an immediate interim loan finance facility from a group of investors led by Richard Hicks, a non- executive director and founder and former chairman of the company.
Under the agreement, the core investor group will lend AIT £6 million on a secured basis, £2 million of which is to be available to the company immediately. The remaining £4 million facility is being made available so that the company will have sufficient finance up to the time of an Extraordinary General Meeting, should it be required. It will only be advanced with the approval of the core investor group.
The core investor group hold an option to convert the full amount of the loan into ordinary shares of AIT following shareholder approval. The interim finance will be provided by a combination of Bessemer Venture Partners - a US technology-oriented venture capital firm - several local private investors and Richard Hicks.
AIT has also struck an agreement with its bankers. AIT's bankers will not demand repayment unless certain events, such as insolvency, occur before 12 September 2002.
The interim finance forms part of a re-financing package whereby AIT will raise up to approximately £11 million before expenses, to be fully underwritten by Old Mutual Securities, and a placing of shares with the core investor group raising in aggregate an additional £2.5 million.
AIT, a supplier of customer relationship management software to banks, has been looking for a buyer after issuing two profit warnings and encountering subsequent liquidity difficulties. The company says it has met with a number of interested parties but "no offers have been received that warrant further consideration".
The board believes this injection of working capital into the company will be sufficient to secure AIT’s medium and long-term future and preserve its position as an independent company.