Graeme Hart wants Reynolds to bring down $18b debt - but IPO not an option

Billionaire Graeme Hart, whose Reynolds Group has some US$18 billion of debt and carries a junk credit rating, has ordered executives in the packaging empire to reduce leverage although an equity raising isn't in the immediate offing.

Reynolds has a B3 credit rating at Moody's Investors Service, meaning it is deemed speculative and a high credit risk. Debt amounted to 6.2 times adjusted earnings before interest, tax, depreciation and amortisation at Dec. 31. Moody's affirmed the rating in December while warning it could be cut if the ratio goes above 7 times.


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