Tecnoglass, a manufacturer of architectural glass, windows and associated aluminum products for the residential and commercial construction industries, amended its senior secured revolving credit facility to increase the borrowing capacity under its committed line of credit from $50 million to $150 million, reduce its borrowing costs by an approximate 130 basis points and extend the initial maturity date by one year to the end of 2026.
PNC Bank led the facility as administrative agent, with Citizens Bank, BBVA, CIT Bank and Wells Fargo Bank serving as joint lead arrangers.
Borrowings under the credit facility will now bear interest at a rate of LIBOR with no floor plus a spread of 1.75%, based on the company’s net leverage ratio, compared with a prior rate of LIBOR with a floor of 0.75% plus a spread of 2.5%. Tecnoglass expects the amendments to provide approximately $3 million of incremental interest expense savings on an annual basis at current outstanding borrowings.
“We’re extremely proud of our outstanding track record of financial performance and cash generation,” Santiago Giraldo, CFO of Tecnoglass, said. “Today’s announcement further demonstrates to our customers, employees, partners and shareholders that our business momentum is very strong and our growth investments are paying off. This transaction, which was widely oversubscribed, reduces our cost of capital while significantly enhancing our liquidity and financial flexibility. Through this refinancing, we now estimate total annual savings of approximately $15 million at current levels of outstanding borrowings since entering into our inaugural U.S. Bank syndicated facility in October of 2020. This upsized revolver positions us exceptionally well to fund future growth initiatives and to further capitalize on opportunities in the quarters and years ahead. We are extremely encouraged by the overwhelming support received by the syndicate of U.S. and European-based banks that understood the strong tailwinds in our business as well as our structural competitive advantages that are allowing us to outpace the industry and gain incremental market share. The syndicate composition and the financial costs achieved in this transaction validate the success of our strategy as a ‘U.S. centric’ company.”