NORTH CANTON, Ohio,
Aug. 30, 2018 /PRNewswire/
-- Diebold Nixdorf (NYSE: DBD) today has obtained a new term
loan and announced amendments to its senior secured credit
agreement, including revised financial covenants, to enhance the
company's financial flexibility. This previously announced
additional financing provides added capital to purchase all of
the remaining shares of Diebold Nixdorf AG, repay debt and support
key company initiatives -- including the company's multifaceted 'DN
Now' operational improvement plan.
"The additional financing announced today not only enhances our
liquidity position but serves as positive reinforcement of the
strength of our long-term business model," said Gerrard Schmid, Diebold
Nixdorf president and chief executive officer. "With this
financing now complete, we will continue to focus on serving our
clients, driving our 'DN Now' operational improvements and
deleveraging our balance sheet."
DN Now actions are expected to drive more than $200 million of savings and include:
- Implementing a new, customer-centric operating model with
expected savings of around $100
million;
- Enacting a new Services improvement plan; and
- Streamlining current solutions and introducing next-generation
product capabilities and cloud-based software offerings.
"This transaction provides support as we continue to streamline
our operating model and realize other cost savings through 2019,"
said chief financial officer Christopher A.
Chapman. "Our stable top-line serves as a base for
improved profitability going forward, driven by solid backlog and
growing Software and Services revenue. At the same time, we are
moving forward with plans to divest non-core businesses and we
intend to use proceeds to further de-leverage."
Details of amounts of additional financing and credit
agreement amendment
Diebold Nixdorf borrowed
$650 million under a newly
established Term Loan A-1, led by GSO Capital Partners LP and
Centerbridge Partners, L.P., of which it used approximately
$250 million to reduce existing term
loans and revolving credit. Remaining funds will be used to pay for
transaction expenses, future minority shareholder redemptions and
provide excess liquidity through partial repayment of outstanding
revolver borrowings. The company received lender consent to amend
and increase allowable leverage ratios under its credit agreement.
JP Morgan Chase Bank, NA, served as the sole and exclusive
administrative lending agent for the company. Evercore served
as financial advisor to the company.
Increased stake in Diebold Nixdorf AG supports a path to 100
percent ownership of German subsidiary
As previously announced, redemption requests from Diebold
Nixdorf AG shareholders increased in August, pursuant to the right
of these shareholders under the terms of the company's acquisition
of Wincor Nixdorf AG. As of August 30,
2018, the company settled requests for approximately 4.6
million shares with a value of approximately $297 million. Following this activity,
Diebold Nixdorf owns approximately
27.6 million shares, or 93 percent of the outstanding shares of
Diebold Nixdorf AG. This level of ownership entitles the
company, at its election, to initiate the process to merge Diebold
Nixdorf AG with and into a wholly-owned subsidiary, Diebold KGaA.
This elective process includes the company's acquisition of all
remaining shares of Diebold Nixdorf AG, which is expected to be
initiated in the future. This is a significant final step in the
integration of the company's German subsidiaries.
As a result of this activity, Diebold
Nixdorf's annual compensation payments to Diebold Nixdorf AG
minority shareholders have been reduced by approximately
$15 million per year due to the
shares repurchased to date. The remaining annual compensation
payments of approximately $8 million
per year will be eliminated once all shares have been
acquired.
About Diebold Nixdorf
Diebold Nixdorf, Incorporated
(NYSE:DBD) is a world leader in enabling connected commerce for
millions of consumers each day across the financial and retail
industries. Its software-defined solutions bridge the physical and
digital worlds of cash and consumer transactions conveniently,
securely and efficiently. As an innovation partner for nearly all
of the world's top 100 financial institutions and a majority of the
top 25 global retailers, Diebold
Nixdorf delivers unparalleled services and technology that
are essential to evolve in an 'always on' and changing consumer
landscape. The company has a presence in more than 130 countries
with approximately 23,000 employees worldwide. Visit
www.DieboldNixdorf.com for more information.
Forward-looking statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Statements can generally be identified as forward-looking
because they include words such as "believes," "anticipates,"
"expects," "could," "should" or words of similar meaning.
Statements that describe the company's future plans, objectives or
goals, including project cost savings, are also forward-looking
statements. Forward-looking statements are subject to assumptions,
risks and uncertainties that may cause actual results to differ
materially from those contemplated by such forward-looking
statements. The factors that may affect the company's results
include, among others: the ultimate impact of the domination and
profit and loss transfer agreement with Diebold Nixdorf AG
("DPLTA") and the outcome of the appraisal proceedings initiated in
connection with the implementation of the DPLTA; the ultimate
outcome and results of integrating the operations of the company
and Diebold Nixdorf AG; the ultimate outcome of the company's
pricing, operating and tax strategies applied to Diebold Nixdorf AG
and the ultimate ability to realize cost reductions and synergies;
the company's ability to successfully operate its strategic
alliances in China; the changes in
political, economic or other factors such as currency exchange
rates, inflation rates, recessionary or expansive trends, taxes and
regulations and laws affecting the worldwide business in each of
the company's operations, including the impact of the Tax Cuts and
Jobs Act of 2017; the company's reliance on suppliers and any
potential disruption to the company's global supply chain; the
impact of market and economic conditions on the financial services
and retail industries; the capacity of the company's technology to
keep pace with a rapidly evolving marketplace; pricing and other
actions by competitors; the effect of legislative and regulatory
actions in the United States and
internationally; the company's ability to comply with government
regulations; the impact of a security breach or operational failure
on the company's business; the company's ability to successfully
integrate acquisitions into its operations; the impact of the
company's strategic initiatives, including DN Now; the company's
success in divesting, reorganizing or exiting non-core businesses;
the company's ability to comply with the covenants contained in the
agreements governing its debt; and other factors included in the
company's filings with the SEC, including its Annual Report on Form
10-K for the year ended December 31,
2017 and in other documents that the company files with the
SEC. You should consider these factors carefully in evaluating
forward-looking statements and are cautioned not to place undue
reliance on such statements. The company assumes no
obligation to update any forward-looking statements, which speak
only to the date of this release.
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