Oatly Group contemplates issuance of Nordic Bonds

Oatly Group (OTLY) will participate in a series of investor meetings to pursue the issuance of SEK denominated senior secured floating rate bonds, has entered into a commitment letter for a new SEK 750M super senior revolving credit facility contemplated to become effective following settlement of the Nordic Bonds, and has entered into Convertible Note Repurchase Agreements with certain holders of 9.25% Convertible Senior PIK Notes due 2028. Collectively, these actions are intended to improve the costs related to and terms associated with the Company’s capital structure while not raising additional financing. The Company will participate in a series of investor meetings to pursue the issuance of the Nordic Bonds. The Nordic Bonds have an expected initial issue amount of SEK 1,700M under a framework of SEK 2,700M and an expected tenor of 4 years subject to certain early redemption features. The Company intends to use the proceeds from the Nordic Bonds to prepay the group’s existing $130M term loan B credit facility in full, to repurchase and cancel certain of its U.S. Notes as further described below and to pay related transaction costs. The issuance of the Nordic Bonds is subject to prevailing market conditions. On September 9, the Company entered into a commitment letter reflecting a commitment from JP Morgan, Nordea and Rabobank to, following settlement of the Nordic Bonds, replace the Company’s existing revolving credit facility with a SEK 750M secured and guaranteed super senior revolving credit facility, which would have a tenor of two years and six months and an initial margin of 4.00% p.a. and be coupled with an uncommitted incremental revolving facility option of up to SEK 750M The commitments under the commitment letter, which is valid up until December 19, are subject to, among other things, execution of satisfactory long-form documentation on the terms set out in the agreed term sheet and satisfaction of the agreed conditions precedent thereunder. On September 9, the Company entered into Convertible Note Repurchase Agreements with the Selling Noteholders holding U.S. Notes. The Company will deliver to the Selling Noteholders a mix of cash in an aggregate amount of approximately $24.7M and the Company’s American Depositary Shares in an aggregate amount of 898,134 ADSs in exchange for an aggregate amount of approximately $42.9M U.S. Notes held by the Selling Noteholders. Settlement of the transactions contemplated by the Repurchase Agreements is subject to customary closing conditions, including settlement of the Nordic Bonds, and is expected to occur after settlement of the Nordic Bonds and the refinancing of the Company’s existing term loan B facility. Upon closing of the U.S. Note Repurchase, the U.S. Notes sold by the Selling Noteholders will be deemed cancelled and no longer outstanding.