Freedom Foods Group Ltd (ASX: FNP) has announced a deal with its lenders.
Freedom Foods sells a variety of products including brands like Milk Lab and Messy Monkeys.
What deal was announced today?
Freedom Foods said it has secured the ongoing support of its principal lenders and majority shareholder, ensuring access to financial facilities while the company undertakes a planned recapitalisation. The company is working through a number of issues today.
It has secured a standstill deed with its two main lenders, HSBC and National Australia Bank Ltd (ASX: NAB). This is effective until 30 November 2020 and is subject to the company meeting certain milestones relating to its recapitalisation plan.
With the support of a guarantee from an entity related to Arrovest, which is the majority shareholder, HSBC and NAB have also agreed to continue to make liquidity facilities available during the standstill period.
Freedom Foods interim CEO Michael Perich said: “We are grateful for the ongoing support of our financiers and our majority shareholder. These agreements provide us with the financial support and flexibility we need to ensure the business continues to perform at its best while we pursue recapitalisation options.”
The company’s shares will remain suspended until 30 October 2020. There’s nothing investors can do right now except follow the story with interest. It seems like the company will get through this period though.
There are plenty of other ASX growth shares that I’d rather invest into. For a similar-ish industry share idea I would buy Bubs Australia Ltd (ASX: BUB) with its international growth potential.
