Safestore Regulatory News (SAFE)

9 May 2012

Safestore Holdings plc

("Safestore", "the Group" or the "Company")

Successful Completion of £400 million Refinancing

Highlights

·      Total facilities increased to £400 million

·      £270 million UK bank facilities extended to June 2016

·      Increased €70 million facility extended to June 2016

·      New £73 million ($115 million) U.S. private placement maturing in 2019 and 2024

·      Strengthened financing group with existing banking partners and new sources of funding

Summary

Safestore, the largest self-storage retailer in the UK and Paris, is pleased to announce that it has completed a full refinancing.  The group now benefits from £400 million in lending facilities, with maturities ranging from 2016 until 2024.  These new arrangements replace the previous £385 million facilities which were all due to expire in August 2013.

Richard Hodsden, Chief Financial Officer, Safestore, commented:

"We are pleased to announce the full completion of our refinancing with a broader lending group on terms that match the needs of the business, offer greater flexibility and extended maturities. 

Our new extended banking facilities provide financial stability and the flexibility to continue our selective store expansion programme.  Our successful completion of a new US Private Placement note issue opens up a new source of funding and further extends our debt maturities.

We continue to benefit from the strong support of our relationship banks and our new lending partners in Europe, Asia and the United States.  Both the banking facilities and U.S. Private Placement were oversubscribed, reflecting our resilient performance and demonstrating further confidence in the future for self-storage." 

Overall Structure

The new banking facilities provide greater operational flexibility with extended maturities and improved diversity of the Group's lending base.  They comprise £327 million in Sterling and Euro denominated bank facilities running to June 2016, with a further £73 million ($115 million) in long-term U.S. private placement notes extending for 7 and 12 years, to 2019 and 2024 respectively.  The blended cost of interest on the Group's overall debt is expected to be in the order of 5.5% per annum.

Banking Facilities

The principal terms of the revised bank facilities include:

·                 Sterling-denominated term facility of £230 million.

·                 Sterling-denominated revolving credit facility of £40 million.

·                 Euro-denominated revolving credit facility increased from €40 million to €70 million. This facility is available to Une Piece en Plus, the Company's principal French subsidiary.

·                 The bank facilities attract a margin over LIBOR ratchet operated by reference to the Group's performance against its interest cover covenant. The margin ratchets between 2.5% and 3.5%, with an initial margin of 3.5% for the first six months of the facilities.

·                 Existing lenders The Royal Bank of Scotland plc and HSBC Bank plc acted as arrangers on the new facilities and continue to hold over 50% of the Group's bank debt.  Members of the syndicate also include Lloyds Bank, Santander Bank, BRED Banque Populaire and Cathay United Bank and we were pleased to see further interest from Asia at this refinancing, with the Bank of Taiwan and Chang Hwa Commercial Bank joining the syndicate.

US Private Placement

The principal terms of the private placement are as follows:

·                 The Company has issued: (i) USD 67 million 5.52% Series A Senior Secured Notes due 9 May 2019 and (ii) USD 48 million 6.29% Series B Senior Secured Notes due 9 May 2024.

·                 The proceeds of the private placement are being principally applied to (i) pay down the Company's existing Sterling-denominated term facility; and (ii) reduce the amount drawn under the Company's existing Sterling-denominated revolving credit facility (which can be redrawn if necessary).

·                 Safestore have fully swapped the proceeds of the US private placement into fixed Sterling.

·                 This is the first such issuance by the Group and the first private placement in the United States by a UK self-storage business. The private placement was arranged by The Royal Bank of Scotland plc and HSBC Bank plc.

Other Matters

There is no amortisation on the US private placement and minimal amortisation on the bank debt.

The Company expects the costs associated with the refinancing exercise to be in the region of £6.5m to £7.0m with minimal, if any, swap breakage costs.

The UK facilities and the US Private Placement are secured against the pool of UK assets whilst the Euro bank facility is principally secured against the assets of Une Piece en Plus.

Enquiries

Safestore Holdings plc                                                 020 8732 1500

Richard Hodsden, Chief Financial Officer

Hudson Sandler                                                           020 7796 4133

Nick Lyon / Wendy Baker

Notes to editors: