Huttig Building Products Increases Borrowing Capacity to $160 MillionJune 2nd, 2014 by DWM Magazine
Huttig Building Products Inc. announced it has entered into an agreement to amend and extend its $120 million senior secured credit facility. The amendment, among other things, increases borrowing capacity from $120 million to $160 million, reduces interest rate charges and extends the facility for five years from the execution date, to May 28, 2019. The amended facility may be increased to $200 million, through an uncommitted $40 million accordion feature, subject to certain conditions. General Electric Capital Corporation (GECC) and Wells Fargo Capital Finance LLC (Wells Fargo) are co-lenders under the facility.
“While our existing credit agreement did not expire until December 2017 we believe that the current lending market, along with our improved financial performance, provides an opportunity to secure a long-term agreement which works very well for the Company,” says Philip W. Keipp, Huttig’s vice president and chief financial officer. “We are pleased to continue our relationship with GECC and Wells Fargo who have been valued lending partners.”
Pricing for the amended facility is based on LIBOR plus 150 to 225 basis points, depending on levels of average borrowing availability. Under the prior facility, executed in December 2012, pricing was at LIBOR plus 225 to 275 basis points. At closing, the initial pricing is LIBOR plus 200 basis points. Index pricing was also reduced.
“We believe the amended facility will enhance our financial flexibility and provide greater liquidity to support our business growth,” adds Keipp.
Further details concerning the amendment are contained in the company’s Current Report on Form 8-K which has been filed with the Securities and Exchange Commission.