Portuguese construction giant Teixeira Duarte reschedules its debt

The Portuguese construction company Teixeira Duarte has announced that it has come to an agreement with its three creditors – banks BCP, Caixa Geral de Depósitos (CGD) and Novo Banco – to have its entire debt rescheduled.

In a communiqué sent to the securities regulator CMVM, the group says that the agreement was made through the E101 – Companies of Intragroup Services (Empresas de Serviços Intragroup), a credit management entity which holds and concentrates the entire debt owed to these banks.

The operation corresponds to 95% of the net bank debt owed by the company to the three banks. Novobanco has the greatest exposure while CGD is less exposed.

The agreement between the E101 and the banks consists in “signing two new financing contracts for a total amount of €654.4 million, as well as the setting up of a new line of bank guarantees of €190 million.

The group has revealed that the average maturity on the loans from the banks will be “more than 10 years” with this agreement.

Teixeira Duarte said in a statement that the “terms of the new financing, namely the respective payments and maturities, will provide financial stability and the sustainable development of the group.”

The agreement signed on Thursday also foresees that one of the new credit lines worth €78.3 million will be “fully paid off” by handing over the shares of five real estate investment companies with the transaction being carried out this year.

Through this amortisation Teixeira Duarte’s gross debt to the banks will be reduced to €576.1 million.

Since 2010 the company’s debts have been reduced from €1.4Bn. In April 2016 the construction group announced an agreement had been struck with the same three banks to restructure and reduce its debt having made a commitment at the time to sell assets worth €500 million.

Teixeira Duarte sold all of its shares that it held in the business park Lagoas Park at Porto Salvo near Oeiras and in Lusoponte which holds the concession for Lisbon’s Vasco da Gama and Ponte 25 de Abril bridges, and 90% of its share in the management of Cascais Hospital which allowed the group to reduce its debt by €459 million – a 39% reduction of its total debt as it stood in 2017.