Root Refinances Term Loan Facility with BlackRock

Root, the parent company of Root Insurance, refinanced its term loan facility with funds and accounts managed by BlackRock Capital Investment Advisors and its affiliates. These improved terms in the long-standing relationship enhance Root’s financial flexibility and improve its cost of capital._x000D_
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The amended facility consists of a six-year term loan with a principal amount of $200 million, reducing the previous facility by $100 million. The amended facility, effective on Oct. 29, will carry an interest rate of 3-month term SOFR plus 600 basis points with performance-based step-downs, reflecting a reduction of at least 300 basis points from the prior term loan. Root maintains $150 million of available capital, net of financial covenants under the amended facility, consistent with the prior facility._x000D_
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“We are excited to complete the refinancing of our term loan, which demonstrates the strength of our business model, our improved operational performance, and BlackRock’s continued confidence in our long-term growth outlook,” Megan Binkley, chief financial officer of Root, said. “By reducing our principal balance and securing more favorable pricing terms, we’ve enhanced our capital structure while maintaining ample growth capital.”_x000D_
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At current interest rates, the amended loan will reduce Root’s interest expense by approximately 50% on a run-rate basis._x000D_
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“This refinancing showcases BlackRock’s ability to provide comprehensive financing solutions to our borrowers wherever they are in their growth cycle,” Corey Schwartz, director at BlackRock, said. “The amended terms and lower cost of capital reflect Root’s strong performance and will enhance its ability to grow as it furthers its ongoing expansion.”