- Atento enters into a restructuring support agreement with
certain key financial stakeholders to obtain support
for a comprehensive balance
sheet restructuring
- Atento continues to work with additional financial
stakeholders to achieve a consensual deal
NEW
YORK, July 3, 2023 /PRNewswire/ --
Atento S.A. (NYSE: ATTO, "Atento" or the "Company"), one of the
world's largest customer relationship management and business
process outsourcing (CRM / BPO) service providers and an industry
leader in Latin America, announces
that, following its announcement on 23 June
2023 regarding its entry into a term sheet providing for a
new interim financing of at least $30
million and a path to a comprehensive restructuring
transaction to significantly deleverage its balance sheet, Atento
has entered into a binding restructuring support agreement with an
ad hoc group of financial stakeholders representing more than 75%
of its US$39.6 million senior secured
notes due 2025, 40% of its US$500
million senior secured notes due 2026, 100% of its currently
outstanding New Money 2025 Notes (as defined below) and 100% of its
currently outstanding Junior Lien
2025 Notes (as defined below).
Restructuring support agreement terms
The terms of the proposed restructuring are set out in the
restructuring term sheet appended to the restructuring support
agreement. If implemented in line with the term sheet, the
restructuring would involve the following changes to the group's
capital structure:
- anticipated net debt leverage ratio of approximately 1.0x or
lower following completion of the restructuring;
- the injection of new interim financing of at least $30 million through the issuance of new money
notes due 2025 ("New Money 2025 Notes") in tranches over time, the
first tranche of which for US$17
million was funded on 30 June
2023;
- the exchange of certain senior secured notes due 2026 for new
notes due 2025 ("Junior Lien 2025
Notes") secured on a junior lien basis to the existing 2025 notes
and new money 2025 notes, and which will be equitized into 100% of
the restructured equity, subject to dilution;
- the provision of up to US$79
million in additional new money investment at emergence from
the proposed restructuring ("Exit New Money"), which is expected to
be in the form of preferred shares in the restructured business;
and
- subject to modifications necessary to obtain commitments for
the Exit New Money, the lender under Atento's super senior
revolving credit facility, the providers of Atento's cross-currency
rate swaps and the holders of Atento's US$500 million senior secured notes due 2026
receiving 5-year warrants for 10% of the fully-diluted restructured
equity at an exercise price representing a 5x multiple on invested
capital.
In the restructuring support agreement, Atento and the
participating financial stakeholders that have executed or acceded
to the restructuring support agreement have agreed, subject to the
terms and conditions of the restructuring support agreement, to
provide support for the restructuring and to facilitate the
implementation of the restructuring, including (in the case of the
participating financial stakeholders) by voting in favour of the
proposed restructuring at any creditor meetings and not taking, or
instructing any other person to take, any enforcement action or
pursuing any other available remedies against Atento or any other
group company. The restructuring support agreement also includes
certain termination events, including where the restructuring has
not completed by the agreed long-stop date.
Next steps
Consistent with its communications to all stakeholders, Atento
continues to work with each of its financial stakeholders to obtain
support for the proposed restructuring and expects additional
parties to accede to the restructuring support agreement over the
coming weeks. Execution of the restructuring support agreement was
a condition precedent to the drawdown of the first tranche of the
new interim financing, which has now occurred, and Atento now has
sufficient flexibility and financial runway to continue
negotiations with each of its other financial stakeholders and move
towards a consensual solution for the restructuring over the coming
weeks.
Atento is targeting a completion date for the proposed
restructuring as soon as possible, and likely before 1 December 2023. Such target date may, however,
be subject to limited extensions and Atento will continue working
with its key financial stakeholders with a view to completing the
transaction as soon as possible. Further announcements and updates
in relation to the restructuring will be provided in due
course.
The restructuring transaction remains subject to the conditions
set out in the restructuring support agreement and the
restructuring term sheet, as well as the entry into of further
definitive agreements.
Atento is represented by Houlihan
Lokey and FTI Consulting as financial advisors and
Sidley Austin and Loyens & Loeff
Luxembourg, as lead legal advisors. The ad hoc group of financial
stakeholders is represented by Rothschild & Co. as financial
advisor and Hogan Lovells as lead legal advisor. GLAS Specialist
Services Limited is acting as lock-up agent.
Stakeholders interested in discussing matters connected with the
restructuring support agreement may contact GLAS Specialist
Services Limited (lm@glas.agency), Houlihan
Lokey (ProjectAtenasHL@hl.com) or Sidley Austin (Sidleyatento@sidley.com).
About Atento
Atento is the largest provider of customer relationship
management and business process outsourcing ("CRM BPO") services in
Latin America and one of the
leading providers worldwide. Atento is also one of the leading
providers of nearshoring CRM BPO services for companies operating
in the United States. Since 1999,
the Company has developed its business model in 16 countries,
employing approximately 135,000 people. Atento has more than 400
clients, offering a wide range of CRM BPO services through multiple
channels. Atento's clients are mostly leading multinational
companies in telecommunications, banking and financial services,
healthcare, retail and public administration sectors. Atento shares
trade under the symbol ATTO on the New York Stock Exchange (NYSE).
In 2019, Atento was named one of the 25 best multinational
companies in the world and one of the best multinationals to work
for in Latin America by Great
Place to Work®. In addition, in 2021, Everest named Atento as a
"star performer". Gartner has named the Company two consecutive
years a leader in its Magic Quadrant since 2021. For more
information visit www.atento.com
Media contact
press@atento.com
Weber Shandwick
Andrea Terroba |
aterroba@webershandwick.com
Esther Presencio – España |
epresencio@webershandwick.com
Forward-Looking Statements
This press release contains forward-looking statements.
Forward-looking statements can be identified by the use of words
such as "may," "should," "expects," "plans," "anticipates,"
"believes," "estimates," "predicts," "intends," "continue" or
similar terminology. These statements reflect only Atento's current
expectations and are not guarantees of future events. These
statements are subject to risks and uncertainties that could cause
actual results and events to differ materially from those contained
in the forward-looking statements. Such risks and uncertainties
include, but are not limited to; Atento's ability to negotiate and
execute any further definitive documentation with respect to the
restructuring transaction and to satisfy the conditions of the
restructuring support agreement; ultimate outcome of the
restructuring proceedings, obtaining required consents from
third-parties and satisfying other conditions precedent for any
additional financing that might be outside Atento's control;
actions by Atento's lenders and other financing sources, including
any creditor actions that could impact Atento's operations;
Atento's ability to improve its capital structure and to address
its debt service obligations through the restructuring transaction,
including potential adverse effects of any potential bankruptcy
proceedings on Atento's liquidity and results of operations;
Atento's future cash requirements; competition in Atento's highly
competitive industries; increases in the cost of voice and data
services or significant interruptions in these services; Atento's
ability to keep pace with its clients' needs for rapid
technological change and systems availability; the continued
deployment and adoption of emerging technologies; the loss,
financial difficulties or bankruptcy of any key clients; the
effects of global economic trends on the businesses of Atento's
clients; the non-exclusive nature of Atento's client contracts and
the absence of revenue commitments; security and privacy breaches
of the systems Atento uses to protect personal data; the cost of
pending and future litigation; the cost of defending Atento against
intellectual property infringement claims; extensive regulation
affecting many of Atento's businesses; Atento's ability to protect
its proprietary information or technology; service interruptions to
Atento's data and operation centers; Atento's ability to retain key
personnel and attract a sufficient number of qualified employees;
increases in labor costs and turnover rates; the political,
economic and other conditions in the countries where Atento
operates; changes in foreign exchange rates; Atento's ability to
complete future acquisitions and integrate or achieve the
objectives of its recent and future acquisitions; future
impairments of our substantial goodwill, intangible assets, or
other long-lived assets; and Atento's ability to recover consumer
receivables on behalf of its clients. Atento is also subject to
other risk factors described in documents filed by the company with
the United States Securities and Exchange Commission. These
forward-looking statements speak only as of the date on which the
statements were made. Atento undertakes no obligation to update or
revise publicly any forward-looking statements, whether as a result
of new information, future events or otherwise.
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SOURCE Atento S.A.