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Gascogne announces the signing of a €126.8 million syndication agreement with a banking pool and a €50 million credit agreement with the European Investment Bank (EIB) with the aim of financing its Industrial Investment Program for the years 2022-2026, principally including the investment in a new paper machine for the site Mimizan.

Since 2014, Gascogne has invested heavily in its industrial instrument (equivalent to 50% of its turnover) thanks to two investment plans of €100 million each and has implemented an effective industrial and commercial policy. This joint effort has

The group was able to recover. EBITDA multiplied by 3, going from €10 million in 2014 to €32 million in 2021, the financial structure has been strengthened with net debt under control at less than €100 million and shareholder equity of €158 million in end of 2021.

In order to maintain this recovery, Gascogne is intensifying its investment efforts with more than 300 million euros planned over the next five years dedicated on the one hand to the acquisition of a new paper machine, taking advantage of the latest technology for a total amount of € 220 million (including the building and technical environment) and on the one hand Others Continued enhancement of the existing industrial tool in the four activities (wood, paper, bags and flexible) to more than 80 million euros.

After more than two years of in-depth studies and discussions with several market players, which were slowed down by the health crisis and high inflation of raw materials and energy, which led to a reassessment of the project cost, the group has to enter into exclusive negotiations with the European paper machine manufacturer with a view to ending Acquisition contract before the end of 2022.

This paper machine will replace 3 of the 4 existing paper machines. It will make it possible to improve the quantities of paper produced by making full use of the on-site pulp production capabilities, to offer the best qualities of unbleached kraft paper, to better meet the demand in the packaging markets, to improve the energy efficiency and environmental performance of the site and finally reduce production costs. This will ultimately result in improved performance and a significant increase in EBITDA for Gascogne.

In order to finance this ambitious investment programme, the Group has developed a financing plan with several players, including in particular investment loans of 175 million euros (detailed below) and an upcoming capital increase of at least 10 million euros.

The remaining balance will be funded through self-financing.

group loan

This credit of 126.8 million euros, which was written by a group of 8 leading banks, consists of 3 tranches:

  • Refinancing loan of €31.8 million to refinance the bank’s existing debt, to be repaid over 7 years
  • An investment credit of €85 million intended to finance investments in 2022-2026, to be repaid over 10 years, including a 3-year concession.
  • Revolving loan of 10 million euros to finance general operating needs

This agreement has been entered into with Societe Generale Bank for Corporate and Investment Banking and Crédit Agricole Aquitaine advising by Crédit Agricole for Corporate and Investment Banking as authorized regulators and bookrunners.

Credit with the European Investment Bank (EIB)

This 50 million euro loan is intended to finance the paper machinery acquisition project;

Repayable over 10 years including 3 years deductible.

other financing

In addition to these two credits, other financing is placed: credits in the aggregate amount of €20 million from BPIrance Financement over repayment periods of 7-10 years and an advance repayable to the Nouvelle-Aquitaine area in the amount of €20 million over 10 years.

Finally, in order to support this plan, the Group will propose at the next annual general meeting of 2023 which will approve the annual and consolidated financial statements for the fiscal year 2022, a draft resolution dedicated to making a decision to increase the capital, while maintaining the right of preferential subscription, in an amount of not less than 10 million Euro, to be implemented before the end of 2023.


financial information manager

Julian Eli – Chief Financial Officer Tel: 05 58 04 28 44

About Gascogne Group:
A major player in the timber sector in France, the Gascogne Group is present at all stages of the development of forest resources and is the only fully integrated French player across the entire wood-paper processing chain. The Gascogne Group, based on 4 complementary activities, is the leading multidisciplinary wood operator in France, the world’s leading producer of natural kraft paper, 3The tenth A European producer of industrial and consumer bags and one of the world’s leading producers of packaging and protective assemblies.

ISIN: FR0000124414 / Reuters: GASP.PA / Bloomberg: BIFP / FTSE: 460

www.groupe-gascogne.com

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