CEVA Logistics, a Swiss-based asset-light third-party logistics company, has proposed refinancing the majority of its existing debt facilities with the objective of achieving lower interest rates, longer maturities and enhanced liquidity to pursue its strategy.
CEVA proposes to offer, subject to market conditions and other factors, $400 million in aggregate principal amount of a secured term loan B due 2025 in a private offering. It also plans to enter into a new $600 million senior revolving credit and ancillary facility due 2023 and has received commitments from its new banking group to this extent.
An additional offering of debt, including by way of senior secured notes, contemplated in Euros and in an amount of approximately $350 million, might follow at a later stage.
The company expects to use the proceeds from the refinancing, together with available cash, to fully repay its existing senior secured credit facilities and for general corporate purposes. It intends to repay the outstanding $580 million aggregate principal amount of its term loans due 2021 and to make a tender offer to repurchase for cash and/or redeem all of the $438 million aggregate principal amount of its 9% first lien senior secured notes due 2020, as well as cancel certain local loans and overdrafts. There can be no assurance that the refinancing will be completed.
CEVA received rating upgrades from S&P Global Ratings and Moody’s Investors Service in May 2018 following the deleveraging from the IPO and improved operating performance. S&P’s long-term issuer rating now stands at BB- with positive outlook, whilst Moody’s has assigned a corporate rating of B1 stable.