Hicks, Muse, Tate & Furst has arranged a credit facility totalling £180m from Barclays Capital for portfolio company Christie-Tyler, the UK furniture manufacturer and retailer. The furniture business has raised £145 million in new senior credit facilities (including a £25 million undrawn revolving facility) and £35 million in senior subordinated loan facilities from the bank.
Hicks, Muse acquired Christie-Tyler in August 1999 as part of its PTP of conglomerate Hillsdown Holdings Plc. Besides Christie-Tyler the acquisition of Hillsdown gave the US buyout firm Horizon Biscuits (which it merged with subsequent acquisition Burton’s Biscuits) and Premier International Foods (which it has restructured and bolted on a series of acquisitions). The firm also separated then divested Hillsdown’s poultry operations. The proceeds from that divestiture, which Hicks, Muse says represented a profit of approximately three times its initial investment, were used to repay debt incurred by the original PTP.
As the buyout firm continues to shake-up of Hillsdown’s operations, it has seized the opportunity to use Christie-Tyler’s improved performance and strong cashflows to recapitalise the business and, in its own words, use the money “to pay a substantial dividend to HMTF’s investors, as well as to repay existing indebtedness.”
Keen to emphasise the message that the firm’s investors in its European Buyout Fund are benefiting significantly, the firm went on to say: “The recapitalisation will enable HMTF’s investors to recoup all of their original investment in Christie-Tyler and to realise a profit, whilst HMTF and its co-investors will continue to own 100 per cent of the equity of Christie-Tyler.”