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(Bloomberg) — Specialty chemical firm Arxada AG won the support of key creditors in its bid to delay debt repayments, as the broader industry faces stress from rising energy prices and subdued demand.
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The Swiss company, backed by private equity firms Bain Capital LP and Cinven Ltd., signed an agreement to amend and extend its debt with a group of senior secured lenders, according to a statement sent to bondholders and seen by Bloomberg News. Other secured creditors are in talks to sign the agreement, it said.
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Arxada later plans to engage with the remaining secured creditors, lenders of its senior facilities and holders of its unsecured notes, according to the statement.
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The Basel-based company, a player in industries including professional hygiene, nutrition and wood protection, has been under pressure from softer demand as well as a high interest burden. Its unsecured bonds are quoted at around 40 cents on the euro, according to data compiled by Bloomberg, a level considered distressed.
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Spokespeople for Arxada and Bain declined to comment. A representative for Cinven wasn’t immediately available to comment.
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The company has around €3 billion ($3.5 billion) in bonds and term loans, denominated in euros and dollars, due in 2028 and 2029.
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Other European chemicals companies, such as SK Capital Partners LP’s Archroma, have been looking to push out their looming debt maturities to buy time in a difficult market environment. The sector is grappling with headwinds such as trade and geopolitical tensions as well as competition from cheaper Chinese alternatives.
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Arxada was formed in 2021, after it was spun-off from chemicals firm Lonza Group AG. The company has grown via the acquisition of Enviro Tech Chemicals Services and Troy Corporation.
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