To enhance liquidity, ATM servicer and software provider Diebold Nixdorf has secured a $650 million capital commitment from two institutional lenders and started a process to amend its existing credit agreement. The funds will be used to acquire remaining shares of Diebold Nixdorf AG and repay debt, among other purposes, the company said in an announcement.
With the terms of the commitment, the company is expected to receive the funds through a Term Loan A-1, due August 2022, that would be implemented in a forthcoming agreement. However, the company said that the credit agreement amendments, including the Term Loan A-1 Facility, are “subject to the satisfaction of certain conditions, including obtaining necessary lender approvals.” In addition, the company disclosed further information in a current report on Form 8-K that was provided to lenders through a filing on Monday morning (Aug. 27).
The news comes as the company has reportedly started considering a sale and hiring financial advisors. According to CNBC, “Diebold hired Credit Suisse and Evercore … to help identify potential buyers,” though it was too early to determine a price for the company.
The company’s shares have been in a free fall after it forecasted lower than expected EBITDA earlier this month, and revealed plans to use cash on hand and its revolving credit line to buy $160 million of shares in Wincor Nixdorf, the German company it acquired in 2016.
Since not all of Wincor’s shareholders tendered the purchase offer two years ago, Diebold held only 77 percent of the outstanding shares as of the end of July. However, earlier this month, 13 percent of the remaining holders asked to be paid, totaling around $255 million. Diebold paid $160 million and will pay the remaining $95 million later this week — it will then own more than 90 percent of the outstanding shares.
D.A. Davidson’s Matt Summerville said earlier this month that, at the end of the second quarter, Diebold had access to $380 million in funds under its revolving credit facility.