Cameron O'Reilly firm completes $1.1bn refinancing


SWITZERLAND-BASED smart metering company Landis+Gyr, which is headed by Irish businessman Cameron O'Reilly, has completed a $1.1 billion (€710 million) refinancing of its borrowings and credit facilities.

The five-year, multi-currency refinancing package was concluded with a group of 13 global banks, including Bank of Ireland and AIB.

The company, which is considering a stock market listing, said the new bank facilities would be used for future growth.

Smart metering is gaining traction internationally and Landis+Gyr recently landed its biggest contract yet - thought to be worth about $360 million - to supply three million electricity meters in Texas. The meters allow consumers to monitor their consumption more closely and enable energy suppliers to predict demand more accurately.

The new financing replaces two previous bank facilities and includes term debt, capital expenditure and bonding, and funds for working capital.

The other members of the banking consortium are: Barclays Capital; Lloyds TSB Corporate Markets; ING Bank; Australia and New Zealand Banking Group; Bank of Scotland; Credit Suisse; Deutsche Bank; HSBC Bank; RBC Capital Markets; Royal Bank of Scotland; and Goldman Sachs Credit Partners.

In an interview with The Irish Times, Mr O'Reilly said the funding had been secured at a lower cost to the company. "We are really pleased to get this away in this difficult market and on improved terms compared with our previous facilities," he said.

Landis+Gyr is today opening a New York office, which will employ up to 15 staff. Mr O'Reilly will relocate there from his home in Sydney, but company headquarters will remain in Switzerland.

Mr O'Reilly, the eldest son of billionaire businessman Sir Anthony O'Reilly, said he hoped to float the company by 2010. "We'll float some time in the next 12 to 18 months, subject to there being a good market window," he said. "If you look at some of our comparables [peer groups] in the industry, they're actually tracking very well with high multiples at the moment. If we had to float we could; it's just not the ideal time.

Mr O'Reilly said the company would "probably have an enterprise value north of $3 billion and an equity value north of $2 billion" at the time of an initial public offering (IPO).

Landis+Gyr was the world's biggest manufacturer of smart meters in 2007 with a 12 per cent market share, according to IMS Research. It has 5,061 staff, 16 manufacturing sites and will earn revenues of about $1.5 billion this year.

Mr O'Reilly, who has built Landis+Gyr through a series of acquisitions since 2002, said his stake at the time of flotation, including share options, was likely to be about 7 per cent. "I don't intend to sell my shares [at the time of flotation]," he added.

Sir Anthony O'Reilly also owns about 7 per cent of the business.

Mr O'Reilly said it was most likely that the IPO would take place in New York.