CECONOMY AG possesses comfortable liquidity reserves consisting of various syndicated revolving credit facilities, which complement the reserves held in cash and other liquid assets. In order to strengthen its liquidity reserves in the light of the COVID-19 pandemic, CECONOMY AG has increased the letter one by €1.7 billion to a new overall volume of €2.7 billion on 12 May 2021. The additional volume is provided by the state-owned bank KfW and a consortium of CECONOMY’s partner banks.
On May 6, 2021, CECONOMY AG signed a new syndicated loan agreement to secure the company's long-term liquidity for the period after the termination of the current credit line with the participation of KfW. The new syndicated loan agreement has a total volume of EUR 1.06 billion and an initial term of 3 respectively 5 years, each with two one-year extension options. It also includes a pricing mechanism linked to the achievement of ESG objectives.
The early termination of the existing credit facility is at the sole discretion of CECONOMY AG and will only be effected if the pandemic situation suggests that this is reasonable according to prudent business judgement. The new syndicated revolving credit agreement can be implemented until the end of November. A later date is not possible, so the committed credit lines under the new syndicated revolving credit facility would expire. In this event, however, it is assumed that CECONOMY AG would then seek to extend the existing tranche with the involvement of KfW by another year on the basis of the market situation still being significantly impacted by COVID-19.
Overview of syndicated revolving credit facility under participation of KfW.
Press release of ESG-linked syndicated revolving credit facility.