The major company OR Group, which owns the Westfalika stores, didn't meet its bond payment obligations.
In January, the company couldn't pay off its five-year bonds, only paying interest on them. Now, it has again failed to meet obligations of over 500 million rubles to Promsvyazbank, turning a technical default into a real one. The company said it was actively negotiating with the bank, but couldn't reach an agreement.
The owner of the Westfalika stores, OR Group (previously known as Obuv Rossii), announced that it actually defaulted on publicly traded bonds of the BO-07 series. reported On the company's website, it was revealed that the bond issuer OOO OR, one of the group's subsidiaries, failed to fulfill its obligations to bondholders in the amount of 592 million rubles during the technical default period, which ended on February 3.
Earlier, on January 20, the retailer announced a technical default. stated that a technical default occurred. announced the technical default on publicly traded bonds of the BO-07 series. The main holder of the bonds (99%) was Promsvyazbank. This issue acts as a loan structured in the bond. OR Group explained that the company considered extending as the primary option for resolving the debt situation. During the 10 days given for fulfilling obligations after the technical default, the group was actively negotiating with PSB, but never reached an agreement with the creditor, according to the message.
The press service of Promsvyazbank previously reported. informedthat an agreement was reached during the negotiations in December 2021, according to which OR Group would redeem all bonds of the BO-07 issue by January 20, and the bank would then consider extending the loans. However, the company did not honor the agreement. As a result, the bank is forced to start usual debt collection measures, the lender said.
The seller pointed to its business operations as a source of money for paying off debts, but acknowledged the impact of the pandemic on the market, which is particularly noticeable in the non-food offline retail segment. About 80% of Westfalika's revenue comes from offline sales, and as a result, the revenue for the year dropped by 21%, the seller explained. This also affected the company's ability to gather the necessary funds to fulfill its obligations related to issue BO-07 in full, according to the report.
As a result, OR Group faced problems in dealing with its liabilities due to high leverage and borrowing costs. The company stated it is preparing a plan of measures to deal with the crisis and is considering options for restructuring its debts. The restructuring will provide resources for business operations, including alterations to the business model, according to OR Group.
OR Group has already started talks with major creditors, including Promsvyazbank, to extend the debt for a longer period, the seller concluded. The company is also looking into the possibility of bringing in investors for the Arifmetika microcredit company.
OR Group placed 500 bonds worth 1 billion rubles on January 26, 2017, on the Moscow Exchange through open subscription. Their nominal value is 2 million rubles each. From 2018 to 2021, the company partially made payments by buying back 204 bonds from the market worth 408 million rubles.
Shares of OR Group fell by 14.03% over the day – to 8.58 rubles, should from the data of the Moscow Exchange.
