KKR hands over control to fellow finance firms, with cash burden reduced 80 per cent
Bis Industries, the private-equity controlled mining logistics, services and equipment firm, has gained $1 billion worth of in-principal funding from a range of present investors.
Formerly controlled by global private equity giant Kohlberg Kravis Roberts (KKR ), Bis has been part of a services sector-wide struggle with the mining downturn.
The debt-for-equity ‘white knights’ are led by fellow private equity company Carlyle, international hedge fund Värde and fund manager and National Australia Bank spin-off Metrics Credit Partners, the first two, like KKR, headquartered in the US.
The trio have been picking up tranches of Bis debt from other finance investors as it struggled with a burden amounting to more than $1 billion owed to a number of banks and other institutions.
“This restructuring is a significant milestone that will reposition Bis to take advantage of future growth opportunities, in addition to continuing to support existing customers.
The deal is said to reduce the Bis debt to $200 million at a time when Australian mining’s future is starting to appear brighter.
“The proposed capital structure represents a generational re-set of our balance sheet and opens up a range of exciting opportunities for our business,” Bis chief executive Brad Rogers says
“Bis has always been a strong operator with a resilient business model and long-term, blue-chip customers, but our capital structure wasn’t suited to the market conditions we’ve seen in the past few years.
“Having now addressed our capital structure, we’ll be in great shape to deal with whatever challenges and opportunities come our way.
“The future owners of the business bring deep international experience and capability, and we’re excited about the opportunity to work with them.”
Rogers adds that a “revitalised balance sheet will create options for the business that didn’t previously exist. After a long process the future prospects are very exciting for all involved”.
The former Brambles Industrial Services and a customer of Kenworth and Scania over the years, Bis was set to be floated at the same time as McAleese in 2013 and had bought truck and trailer-maker Powertrans in the lead-up before post-GFC market sentiment went against the move.