Daily News: June 21, 2013

J.P. Morgan, Merrill Arrange New $1.7B Revolver for Group 1

Retailer Group 1 Automotive announced it has completed a $1.7 billion five-year revolving syndicated credit facility with 25 financial institutions that will expire in June 2018 and can be expanded to $1.95 billion total availability. The syndication was arranged through J.P. Morgan Securities and Merrill Lynch.

Lenders in the syndicated facility include 6 manufacturer-affiliated finance companies and 19 commercial banks. The 6 manufacturer-affiliated finance companies are: Toyota Motor Credit, Mercedes-Benz Financial USA, BMW Financial Services, American Honda Finance, Nissan Motor Acceptance and VW Credit.

The 19 commercial banks are: Bank of America, Comerica Bank, JPMorgan Chase, Wells Fargo, U.S. Bank, Compass Bank (d/b/a BBVA Compass), Capital One, and Bank of the West, KeyBank, MassMutual Asset Finance, Barclays Bank, Amegy Bank, BB&T, TD Bank, Ally Insurance Holdings, NYCB Specialty Finance, Amarillo National Bank; BOKF (d/b/a Bank of Oklahoma) and Cadence Bank.

The revolving facility will provide $1.38 billion for inventory floor plan financing. The facility will also provide $320.0 million for working capital, acquisitions and general corporate purposes, of which up to $125 million can be borrowed in either Euros or Pounds Sterling. New vehicle and used vehicle floor plan interest rates will decrease 25bps to one-month LIBOR plus 125bps and one-month LIBOR plus 150bps, respectively.

“The expanded $1.7 billion revolving facility further strengthens Group 1’s balance sheet by locking in ample, reasonably-priced capital for vehicle financing and acquisition growth for the next five years,” said John C. Rickel, Group 1’s senior vice president and chief financial officer. “The commitments made by the 20 existing lenders are a testament to the strong relationships we have established with our financial partners over the years and we are delighted to have 5 new lenders join our syndicate, including American Honda Finance Corporation, a new manufacturer-affiliated partner.”

Hoston, TX-based Group 1 Automotive owns and operates 139 automotive dealerships, 178 franchises, and 35 collision centers in the United States, the United Kingdom and Brazil that offer 35 brands of automobiles.