Digirad closed a new revolving credit agreement with Comerica Bank.
The revolving credit agreement is a five-year revolving credit facility, with a maximum credit amount of $25 million, of which the entire $25 million is immediately available.
In conjunction with the closing of the Comerica credit agreement, the company also announced the termination and payoff of its previous credit facility with Wells Fargo.
Digirad CFO Jeff Keyes said, “This new revolving credit agreement provides us with significantly improved capital management flexibility. Under the terms of the new agreement, we will enjoy no restrictions relative to dividend payments and equity purchases, as well as increased flexibility on acquisitions. We will also benefit from lower overall fees and a lower overall effective interest rate.”
The credit agreement has an overall interest rate of LIBOR + 2.35%.The previous credit facility with Wells Fargo incurred interest at LIBOR + 2.00% to 5.00%, with the largest tranches being at LIBOR + 2.50% and 5.00%.
Digirad provides a diverse portfolio of mobile healthcare solutions and medical equipment and services, including diagnostic imaging and patient monitoring.