GE Capital, WFCF Extend Huttig $120 Million Facility
Wednesday, December 26, 2012
Huttig Building Products entered into an agreement to amend and extend its $120 million senior secured credit facility. The amendment, among other things, extends the facility for five years to December 21, 2017.
The amended facility can be increased to $160 million, through an uncommitted $40 million accordion feature, subject to certain conditions. General Electric Capital (GECC) and Wells Fargo Capital Finance are co-lenders under the facility.
Philip W. Keipp, Huttig's vice president and CFO, said, "While our existing credit agreement did not expire until September 2014 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. 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 225 to 275 basis points, depending on levels of average availability. Under the prior facility, executed in September 2010, pricing was at LIBOR plus 225 to 300 basis points. At closing, the initial pricing is LIBOR plus 250 basis points. In addition, among other things, the amended facility provides for certain changes to the borrowing base, permitted acquisition, and cash dominion provisions of the agreement.
"The amended credit facility will provide the company with additional borrowing capacity and bring increased financial flexibility. We believe the agreement is an endorsement of the company's proven ability to manage through a challenging market environment while putting itself in position to take advantage of growth opportunities presented by an improving housing market. Executing the facility allows us to remain focused on meeting market challenges and growing our business while mitigating lending risks which may be brought by any general economic or political uncertainty," said Keipp.
Huttig Building Products is a domestic distributor of millwork, building materials and wood products used principally in new residential construction and home improvement, remodeling and repair work.