FrieslandCampina improves financing

19 May 2010

Dairy company Koninklijke FrieslandCampina N.V. has improved its financing. The conditions of a EUR 1 billion Revolving Credit Facility have been adjusted and the term extended by one year to August 2013. In addition, FrieslandCampina has successfully placed a private loan of USD 196 million and EUR 25 million with institutional investors in the United States and Europe.

FrieslandCampina has reached agreement with all fourteen banks taking part in a EUR 1 billion Revolving Credit Facility to improve the facility’s conditions by lowering the interest mark-up and extending the term. The term of the facility has been extended by one year until the end of August 2013. The size of the facility remains unchanged at EUR 1 billion. The adjustment could be realised on the strength of the developments in the market and the company’s improved creditworthiness profile.

FrieslandCampina has placed a private loan of USD 196 million with institutional investors in the United States and EUR 25 million with a European investor. These Senior Notes have a term of seven or ten years and are intended to replace short-term debts with banks by long-term debt. The loan was placed in the United States where the company was able to negotiate better financial terms than in the Netherlands.

Kees Gielen, Chief Financial Officer of FrieslandCampina: “We are satisfied with the improvement and broadening of our financing. The adjustment of the Revolving Credit Facility conditions will yield an annual saving of several millions of euros. The placement of the Senior Notes was successful thanks to our strong international position in the markets for dairy products and the fact that we are already known to many US investors. We are able to convert short-term bank loans into long-term loans on favourable conditions. By tapping into the US capital market, we have placed our financing on a broader base.”

In 2003 FrieslandCampina (then operating as Friesland Foods) successfully placed Senior Notes of USD 213 million and EUR 20 million in the same market. Part of this loan is due to mature in December 2010.

The shares of FrieslandCampina are held by the dairy co-operative Zuivelcoöperatie FrieslandCampina U.A. The 15,300 member companies of this co-operative are thus the owners and the company’s most important providers of equity.