Apollo Global Management is set to lose control of Italian packaging group Reno de Medici as part of a restructuring agreement that will transfer ownership to the company’s bondholders, according to a report by Bloomberg citing unnamed people familiar with the situation.
Under a preliminary deal, holders of the company’s €600m bond package are expected to convert a portion of their debt into a majority equity stake, while also providing additional capital to support the business, the sources said. The arrangement has been agreed in principle between Apollo, the company, and key creditors, though final documentation is still pending.
Apollo, Reno de Medici, and participating bondholders reportedly declined to comment.
Reno de Medici, a manufacturer of recycled fibre carton-board used in packaging applications, has been under financial pressure for several months amid rising input costs and weaker operating performance. The situation has prompted prolonged negotiations with creditors over a restructuring of the group’s capital structure.
Apollo acquired a controlling stake in the business in 2021, marking the first investment from its Impact platform, which targets opportunities with environmental and social considerations alongside financial returns.]
The restructuring will also involve lenders to Reno de Medici’s €145m revolving credit facility, who have been engaged in parallel discussions and have appointed advisers to support negotiations.
Bondholders in the company include Arini and M&G Investments, both of which are expected to play a central role in the transition of ownership as part of the debt conversion process.
Reno de Medici’s bonds are currently trading at deeply distressed levels, reflecting market expectations of a restructuring outcome, while rating agencies have previously downgraded the company’s credit profile amid ongoing financial strain.
The deal would mark a further example of private equity sponsors relinquishing control of portfolio companies as higher input costs and tighter financing conditions continue to pressure parts of the European industrial sector.
