Kaufman & Broad in €681.5 Million Debt Restructuring

January 23, 2009

Cleary Gottlieb represented Kaufman & Broad SA in the restructuring of its €681.5 million financial debt, designed to reinforce its financial flexibility. The final amended financial documentation was signed on January 23.

Kaufman & Broad, listed on Euronext Paris by NYSE Euronext, is one of France’s leading developers and homebuilders and is 85% owned by PAI partners, a leading European private equity firm, as a result of a leverage acquisition completed in 2007.

On December 26, 2008, Kaufman & Broad entered into a heads of agreement with all the lenders party to its senior facilities agreement dated July 9, 2007, setting forth the main terms and conditions of the restructuring. The existing financing documentation has been amended to reflect such terms and conditions, providing in particular for an additional liquidity facility of €75 millions over two years (through the extension of the purpose of the initial €80 millions acquisition/capex facility to the financing of the working capital and general corporate purposes of the group and its reduction to €75 millions) ranking senior to all the other existing facilities; an adjustment of the financial covenants applicable to its group including five quarters without financial covenant test; and the suspension of dividend payments for at least three financial years.