Monarch and Arini offer €200 million to Kem One

Credit funds Monarch Alternative Capital and Arini have provided €200 million ($217 million) in new debt to Kem One SASU, a French chemicals company. This funding is intended to help the company during a critical time when it is experiencing a cash flow crisis. Kem One is backed by Apollo Global Management. The company announced that the money will be used to support its business plan and to pay off €100 million of existing revolving debt. The new loan will have similar security to existing loans and additional collateral. This new financing gives Monarch and Arini priority over other creditors, including those holding Kem One’s €450 million high-yield bonds due in 2028. Some investors with existing debt have also joined efforts to raise funds, as reported by Bloomberg. Kem One has been struggling with declining sales and increased competition. Rising energy costs and lower construction activity have also put pressure on its finances. Ratings agencies have pointed out the challenges the company faces in maintaining liquidity. Despite these challenges, Kem One plans to improve its financial health. The company has made investments to upgrade its production network, which it believes will lead to better earnings in the future. It projects Ebitda of €196 million by 2027, although this will still be lower than the figures seen in 2021 and 2022. The new loan consists of an initial €120 million, with the option to draw an additional €80 million over the next 18 months.