ATSG Increases Bank Credit Facility to Support Growth Initiatives
June 01 2016 - 1:10PM
Business Wire
Air Transport Services Group, Inc. (NASDAQ:ATSG) announced today
that it has obtained commitments for an expansion of the revolver
portion of its secured credit facility with a consortium of banks
led by SunTrust, and that it has extended the maturity of the
entire facility by 12 months.
The changes increase by $100 million, to $425 million, the
revolving credit portion of the credit facility with the bank
group. Additionally, the facility includes an amortizing term loan
which currently has an outstanding balance of $97.5 million. Both
the revolver and term loan mature in May 2021.
Quint Turner, Chief Financial Officer of ATSG, said, "We
appreciate the continued strong support of our long-time bank group
as we invest our capital to meet the growing customer demand for
our mid-size freighter assets and support services, while at the
same time continuing to repurchase our shares. The responses from
our lender group indicated they are willing to provide even greater
credit availability beyond our current request, should the need
arise."
Other features of the amendment include:
- Permitted annual share repurchases were
increased from $50 million to $75 million, subject to a leverage
ratio based on EBITDA as defined under the credit agreement. The
leverage limitation is no greater than 2.75 times, up from 2.5
times under the prior agreement, on a trailing 12 months basis.
ATSG’s Board of Directors increased its share repurchase
authorization to $100 million on May 12, 2016.
- The increase in the revolver ceiling
includes a new $100 million accordion feature, under which the
limit on revolver credit could increase up to $525 million with
approval of the bank consortium.
The variable interest rate structure on the revolver remains
unchanged. Rates are affected by LIBOR, plus an interest rate
spread that adjusts based on the stated leverage ratio. The
revolver interest rate is currently 2.2 percent.
Outstanding debt against the revolver was $240 million at March
31, 2016. The credit facility is secured by certain designated
aircraft.
About ATSG
ATSG is a leading provider of aircraft leasing and air cargo
transportation and related services to domestic and foreign air
carriers and other companies that outsource their air cargo lift
requirements. ATSG, through its leasing and airline subsidiaries,
is the world's largest owner and operator of converted Boeing 767
freighter aircraft. Through its principal subsidiaries, including
two airlines with separate and distinct U.S. FAA Part 121 Air
Carrier certificates, ATSG provides aircraft leasing, air cargo
lift, aircraft maintenance services and airport ground services.
ATSG's subsidiaries include ABX Air, Inc.; Airborne Global
Solutions, Inc.; Air Transport International, Inc.; Cargo Aircraft
Management, Inc.; and Airborne Maintenance and Engineering
Services, Inc. For more information, please see www.atsginc.com
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version on businesswire.com: http://www.businesswire.com/news/home/20160601006635/en/
ATSG Inc.Quint O. Turner, 937-366-2303Chief Financial
Officer
Air Transport Services (NASDAQ:ATSG)
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