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Deceuninck secures refinancing deal

By: Richard Higgs

July 24, 2012

HOOGLEDE, BELGIUM (July 24, 12:15 p.m. ET) — Belgian PVC window frame maker Deceuninck NV has sealed a 140 million euro ($170 million) refinancing deal allowing the group to develop its strategy over the coming five years.

The company, based in Hooglede-Gits in Belgium, has agreed a five-year credit facility with a syndicate of five European banks despite the challenging economic environment. The funding consists of a 100 million euro multi-currency revolving credit facility and a 40 million euro three and a half year term loan.

This financing agreement replaces an earlier long term credit deal concluded in September 2009 consisting of a syndicated bank facility due to expire in September 2013 and senior secured notes maturing in September 2014.

The new deal enables Deceuninck to repay the senior secured notes in full and allows it to pay a dividend.

Banks in the new syndicate include ING, BNP Paribas Fortis, Commerzbank, Banque LB Lux and KBC.

Conditions of the latest agreement are easier than for the previous loans, reflecting Deceuninck group’s stronger position since its 2009 financial restructuring. In the first half of 2012, the group reported a 2 percent increase in annual sales amounting to 274.3 million euros against the same period in 2011.

“This agreement finally concludes one of the most challenging chapters in the 75 year history of Deceuninck,” said CEO Tom Debusschere in a statement.

“This reflects the confidence of the banks in our sound financial position and our long term competitive power. For the next five years, this new facility provides sufficient headroom and flexibility to further execute our strategy and duly respond to an uncertain economic environment,” the chief executive added.

Deceuninck has suffered from declining construction markets and soaring PVC costs in recent months although resin prices have eased towards the end of the second quarter. The group has also benefited from rising demand in the latest period in Russia, Turkey and the United States, while volumes in Germany and Belgium remained stable, it reported.

The company's Deceuninck North America LLC unit is based in Monroe, Ohio.