Tenneco Amends, Restates Credit Facility With JPMorgan, Others
Tenneco Inc. announced that it has entered into an amendment and restatement to refinance its existing $834 million senior credit facility with a new $1.1 billion senior credit facility. This refinancing will enhance Tenneco’s financial flexibility by lowering annual interest expense, and increasing the size and extending the term of its revolving credit facility.
According to the company’s 8-K filing, JPMorgan Chase Bank is the administrative agent, Bank of America, Barclays Bank, Morgan Stanley Senior Funding, The Bank of Tokyo-Mitsubishi UFJ and Wells Fargo Bank are document agents, Citigroup is syndication agent and J.P. Morgan Securities, Barclays Bank, Citigroup Global Markets, Wells Fargo Bank, Merrill Lynch, Morgan Stanley Senior Funding and Bank of Tokyo-Mitsubishi UFJ are joint lead arrangers and joint bookrunners.
The new senior credit facility consists of a $850 million revolving credit facility and a $250 million term loan A facility, which replace Tenneco’s former $556 million revolving credit facility, $148 million term loan B facility and $130 million tranche B-1 letter of credit/revolving loan facility. The revolving credit facility will mature on March 22, 2017. The term loan A facility requires quarterly installments and has a final maturity of March 22, 2017. The proceeds of the term loan A facility will be used to fund Tenneco’s previously announced tender offer for any and all of its outstanding $250 million 8 1/8 percent Senior Notes due 2015.
“This new credit facility improves Tenneco’s financial flexibility and significantly lowers our borrowing costs,” said Gregg Sherrill, chairman and CEO, Tenneco Inc. “The retirement of the 2015 notes and expansion of our revolver improves our debt maturity profile while reducing our annual interest expense by approximately $20 million.”
Tenneco will pay LIBOR plus 2.50% on borrowings under the revolving credit facility and the term loan A facility. Tenneco previously paid LIBOR plus 4.00% on borrowings under its revolving credit facility and LIBOR plus 4.50% on borrowings under the term loan B facility.
Tenneco is a $7.2 billion global manufacturing company with headquarters in Lake Forest, IL. It is a designer, manufacturer and marketer of emission control and ride control products and systems for the automotive and commercial vehicle original equipment markets and the aftermarket.
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