Global Brass and Copper Holdings refinanced its debt structure by retiring its senior secured notes and entering into a new $200 million asset-based revolving credit and a $320 million term loan credit facility.

“Successfully refinancing our debt will significantly improve our cash flow while providing greater financial flexibility to further strengthen our competitive position and to create future value for shareholders,” said John Wasz, GBC’s president and CEO. “This debt refinancing represents a significant milestone in rightsizing our capital structure and strengthens the foundation from which to grow our company both organically and through acquisitions.”

The company used the proceeds from the term loan, along with approximately $11.8 million cash, to retire its $305.3 million senior secured notes facility, which bore interest at a rate of 9.5%, and for ongoing working capital and other general corporate needs. Based on current market conditions and interest rate environment, this refinancing represents a 425 basis point reduction in its borrowing rate, which equates to an approximate $12 million reduction in interest annually.

In a related transaction, the company also replaced its existing asset based revolving credit facility by entering into a new ABL facility that matures on July 19, 2021. This facility allows for borrowings up to the lesser of $200 million or the borrowing base. Along with a $200 million accordion feature, this facility bears interest at LIBOR+1.25% to 1.75%, depending on availability. At closing, no borrowings under the ABL facility were outstanding.

According to a related 8-K filing, JPMorgan Chase served as administrative agent for both transactions. For the ABL facility, Bank of America and Wells Fargo were co-syndication agents.

For the term loan, Bank of America, Wells Fargo and Deutsche Bank were co-syndication agents. Branch Bank and Trust, KeyBank and William Blare & Company were co-documentation agents.

Global Brass and Copper Holdings, through its wholly-owned principal operating subsidiary, Global Brass and Copper, is a converter, fabricator, processor and distributor of specialized non-ferrous products in North America.