Adler Group SA, a German landlord, has reached an agreement with a majority of bondholders to revamp its debt and provide additional liquidity to the struggling company. This marks the second debt restructuring for Adler in the past two years. Under the proposal, the company’s debt maturities will be extended to December 2028, December 2029, and January 2030. Additionally, a significant portion of the second-lien notes will be converted into subordinated perpetual notes, totaling €3 billion ($3.25 billion) of new notes.
According to the statement, the company will receive an additional €100 million through an increase in the first-lien debt facility. The agreement also allows for the retention of up to €250 million from property sales, which would have been used to pay off existing high-priority debt.
Adler had to restructure its debt due to difficulties in generating enough cash from property sales, as property values plummeted. The debt restructuring faced significant opposition from creditors last year, with holders of long-term debt successfully appealing the plan in court, claiming that they were treated unfairly.
According to Adler, in the most recent debt agreement, all second-lien bondholders will be treated equally, regardless of the maturity of their bonds. Additionally, as outlined in a separate statement, bondholders will also receive voting securities that represent a total of 75% of Adler’s voting rights.