Business Context and Reporting Period
This Form 6-K filing by Constellium N.V. (Constellium SE) covers the month of March 2016. The report discloses the entry into a material definitive agreement on March 16, 2016, involving a subsidiary, Wise Alloys LLC.
Key Financial Metrics
The filing does not provide revenue, profit, cash flow, margin, or general liquidity metrics. The only specific financial figure disclosed relates to the new financing facility:
- Receivables Purchase Facility: Up to $100 million aggregate outstanding.
- Cost of Financing: LIBOR plus 2.00% to 2.50% per annum (based on account debtor credit rating).
- Structure: Non-recourse sale of receivables.
Material Changes
The primary material change is the execution of a new Receivables Purchase Agreement ("New Wise RPA") between Wise Alloys LLC and Hitachi Capital America Corp., with Greensill Capital Inc. as the purchaser agent. This agreement replaces or supplements prior arrangements for the sale of receivables.
Outlook, Risks, and Contingencies
Guarantees: Constellium Holdco II B.V. has provided a guaranty for the performance obligations of Wise Alloys LLC under the agreement.
Termination Date: The agreement is set to terminate on March 15, 2017.
Conditions Precedent and Risks: The purchaser's obligation to buy receivables is subject to specific conditions, including:
- No occurrence of a change of control.
- No material adverse change in the business condition, operations, or performance of the seller, Wise Alloys, or Constellium Holdco II B.V.
- Credit Rating Maintenance: Constellium's corporate credit rating must not be withdrawn by Standard & Poor's or Moody's, nor downgraded below B- (S&P) or B3 (Moody's).
Investor Verification Checklist
- Verify the current corporate credit ratings of Constellium with Standard & Poor's and Moody's to ensure they remain above the B-/B3 threshold.
- Confirm the utilization rate of the $100 million receivables facility.
- Review the specific terms of the guaranty provided by Constellium Holdco II B.V. for potential balance sheet impacts.
- Monitor for any material adverse changes in the operations of Wise Alloys LLC that could trigger a termination of the facility.