Action for annulment against Karlie's bond restructuring triggers deferral of coupon payment

Karlie has announced that the payment of the annual coupon for its bond has been deferred to 13 July 2016. Scope’s rating on Karlie remains at Selective Default (SD) until the coupon has been paid.

Karlie has announced it will defer paying its bond’s annual coupon to 13 July 2016 as creditors' representatives have threatened legal action against the decisions of the bondholders’ meeting. Karlie’s bondholders have agreed to restructure its outstanding EUR 10.1m senior unsecured corporate bond on 30 May 2016, including a reduction of the annual coupon from 6.75% to 5.0% and an extension of the bond’s maturity from June 2018 to June 2021. The company has given evidence that the payment of the coupon for the period from 26 June 2015 to 25 June 2016 has been deposited at the payment authority on time. While the bond prospectus does not state a grace period for the coupon payment, Scope treats the bond as having an imputed grace period of 30 days, which Scope deems as market practice. If the interest on the bond is not paid before this period expires on 24 July 2016, this would constitute an event of default.

Scope will wait to reassess Karlie's creditworthiness, which incorporates the change to the bond’s features, until the legal matter has been resolved and the coupon has been paid out to Karlie’s bondholders.

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