Daily News: June 7, 2012

Fifth Third, Others Close $300 Million for Globe Specialty Metals


Globe Specialty Metals, Inc. announced the closing of a new $300 million syndicated credit facility. The facility refinanced existing debt and closing costs of $96.5 million and provides an additional $203.5 million of borrowing availability. This availability, along with the company’s $140.7 million cash balance at March 31, 2012, will provide significant capital to finance acquisitions, growth initiatives, stock buy-backs, working capital and be used for general corporate purposes.

The facility is a revolving loan and does not require a borrowing base. It has a five-year term and, at the current leverage ratio, carries an interest rate of LIBOR plus 1.75%. The loan has certain financial covenants, negative covenants and restrictions.

The credit facility was led by Fifth Third Bank as joint lead arranger and administrative agent, Bank of America Merrill Lynch as joint lead arranger and, KeyBank, Sovereign Bank and Wells Fargo Bank as co-syndication agents. The facility also includes as co-documentation agents BBVA Compass Bank, Citibank, Citizens Bank of Pennsylvania, HSBC Bank USA and PNC Bank and, as participants, First Niagara Bank, Capital One, Branch Banking and Trust Company and Comerica Bank.

Globe executive chairman Alan Kestenbaum commented, “We are very pleased to have closed this financing and to partner with this distinguished group of financial institutions. This credit facility will add significant flexibility and capacity as we pursue the future growth of our Company. Credit constrained environments tend to create opportunities for companies who have remained disciplined and liquid. Our balance sheet, combined with this new credit facility, will give us the resources to capitalize on these types of opportunities.”

Globe Specialty Metals, Inc. is a producer of silicon metal and silicon-based specialty alloys.