CGI to take control of Southend Airport
Image courtesy Southend Airport
This will proceed on a consensual basis, rather than through a contested court process, which could be potentially destructive for all stakeholders. The terms of the recapitalisation proposal for LSA involves a conversion of the convertible loan of £193.75 million due to CGI into an 82.5% stake in LSA and a similar conversion of the £24.3 million debt due by LSA to Esken Aviation Limited (EAL), a wholly owned subsidiary of the Company, into a 17.5% stake.
Funding of the proposal agreed with the board of LSA includes an initial £5 million of short-term unsecured bridge funding to the airport through to the conclusion of the process as part of a commitment of £32 million of new funding to secure the future growth of the airport.
The terms of the proposed restructuring plan for Esken, which will require a court process and is expected to complete after the LSA recapitalisation process, would involve amongst other things an equitisation of the exchangeable bond and certain other creditors within the Group.
It will also require a delisting of the shares on the London Stock Exchange. Cyrus will provide liquidity to the Esken group to meet its working capital needs during this process and to allow an orderly wind down of the remaining group.
