Ardagh Glass, the privately held, Dublin-based container manufacturer controlled by financier Paul Coulson, plans to distribute €20m to shareholders as it launches a fresh €180m bond issue.
Ratings agency Moody's yesterday questioned the planned distribution, saying it "reduces headroom for unexpected performance shortfalls".
Ardagh Glass is 39pc owned by the Luxembourg-based Yeoman investment vehicle. Mr Coulson and his family own 34pc of Yeoman. A share buyback based on those metrics could yield him and his family about €2.6m.
Moody's said that one of Ardagh's group companies, Ardagh Glass Finance, was planning to raise €180m of bonds that would be due for repayment in 2020, and reaffirmed its B2 rating on the Ardagh group.
The agency said Ardagh intended to make a €20m cash distribution to shareholders via a share buyback. It added that while the distribution could be accommodated within the current B2 group Ardagh rating, it could reduce contingency cash balances in the event of an unexpected dip in company performance.
"Despite the intended distribution, Ardagh continues to dispose of a solid liquidity cushion, but Moody's cautions that availability under Ardagh's credit facilities is contingent upon compliance with certain financial covenants," the agency noted.
The €180m of bonds that Ardagh Glass Finance plans to issue are intended to re-finance €175m of senior notes due for repayment in 2013, which were issued by a Dutch subsidiary.