JPMorgan Chase Bank served as the administrative agent on a new $625 million revolving credit facility for Briggs & Stratton.
The new revolver is scheduled to mature in 2024 and is secured by certain of the company’s and its subsidiaries’ working capital and other assets. It was increased from the company’s previous facility of $500 million.
Bank of America, Bank of Montreal and Wells Fargo joined JPMorgan Chase as joint lead arrangers on the facility.
“This new facility gives us added flexibility to fund seasonal borrowing needs and for general corporate purposes as we work to de-lever and strengthen the balance sheet,” said Mark Schwertfeger, senior vice president and CFO of Briggs & Stratton. “While borrowing under the new facility is variable, based on the aggregate amount of underlying assets, we are encouraged that the larger size provides us a foundation for our capital structure, especially as we look to ultimately retire the senior notes that mature in December 2020.”
Borrowings under the new facility bear interest at a variable rate based on LIBOR plus a spread dependent on the trailing twelve month consolidated fixed charge coverage ratio as defined by the agreement. The company continues to project that fiscal 2020 consolidated interest expense will be approximately $34 million. The new facility contains a springing fixed charge coverage financial covenant that must be met if borrowings exceed a set percentage of the borrowing base.
Headquartered in Milwaukee, Briggs & Stratton is the world’s largest producer of gasoline engines for outdoor power equipment. It designs, manufactures and markets power generation, pressure washer, lawn and garden, turf care and job site products through its various brands.
