07/02/2010

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BorsodChem lenders approve financial restructuring

After completion of the restructuring deal on 29 June 2010, Wanhua provides BorsodChem with new funds of EUR 140 million (approximately HUF 39 billion) in total, which the company will use to complete the construction of the new TDI 2 (Toulene di-isocyanate) plant and the new nitric acid plant as well as for general corporate purposes.
The financial restructuring approved by the lenders provides the company with significant further financial flexibility and a solid platform for long term growth.
In exchange for the new money, Wanhua receives an approximately 38 % stake in First Chemical Holding Kft. (FCH), the holding company of BorsodChem currently owned by FCL and a call option to purchase the remaining shares in FCH from the existing shareholders.
"The management is pleased that the lenders have signed off the consensual agreement. With this, jobs continue to be safe at BorsodChem and the company is now ready to restart the TDI and nitric acid investments, which are expected to significantly further improve the profitability of the company”, says Wolfgang Büchele, Chairman and CEO of BorsodChem.
"By the lenders' approval Wanhua has now officially become a shareholder in BorsodChem. We strongly believe that we have achieved a win-win solution for all stakeholders. We are glad that we have a call option which allows Wanhua to obtain full control of the company. We have also invited VCP to remain a shareholder in BorsodChem. We believe that Wanhua jointly with BorsodChem can become a dominant player in the global isocyanate industry. We will continue to grow the business locally relying on the expertise of the current management and VCP", Jason Ding, Chief Executive Officer of Wanhua Industrial Group comments.
"On the back of the investments by the Permira Funds and VCP done over the last three years, BorsodChem remains uniquely positioned to become one of the leading isocyanate producers in Europe . We are convinced that the company will continue on this path initiated by the Permira Funds. We are glad that BorsodChem has now a solid platform for long term growth. This is in the interest of employees, customers and suppliers", says Christian Neuss, Partner at Permira.

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