Diamond Foods Completes Refinancing of Debt Capital Structure
February 19 2014 - 11:20AM
Diamond Foods, Inc. (Nasdaq:DMND) (the "Company" or "Diamond")
today completed the refinancing of its debt capital structure, as
previously announced.
"We are pleased with our new debt structure," said Raymond
Silcock, Diamond's Chief Financial Officer. "In addition to
substantially reducing interest expense, it will also provide us
financial flexibility for the future."
The Company today closed its previously announced Rule 144A
offering of $230 million in aggregate principal amount of 7.000%
Senior Notes due 2019. Credit Suisse Securities (USA) LLC, Wells
Fargo Bank, National Association, Barclays Capital Inc., BMO
Capital Markets Inc., and SunTrust Robinson Humphrey Inc. acted as
initial purchasers of the notes. The proceeds from the offering
will be used to prepay outstanding indebtedness under the Company's
existing credit facility and to redeem its senior unsecured notes
due 2020 held by Oaktree, including a prepayment premium.
Diamond also announced today the closing of a $125 million
syndicated secured credit facility pursuant to an asset based
Credit Agreement, among the Company, as Borrower, Wells Fargo Bank,
National Association, as Administrative Agent, Swing Line Lender,
Syndication Agent, Sole Lead Arranger and Sole Bookrunner, SunTrust
Bank as Documentation Agent, and the other Lenders party thereto.
The ABL Credit Facility has a 4.5 year term, during which the
Company may make aggregate drawings not to exceed the lesser of
$125 million and an amount equal to the borrowing base specified in
the ABL Credit Facility. Under the ABL Credit Facility, the Company
has a $20 million sublimit for the issuance of letters of credit,
and a Swing Line Facility of up to $12.5 million for same day
borrowings. The ABL Credit Facility was used to refinance certain
indebtedness of the Company, and may be used to finance the ongoing
general corporate needs of the Company and its subsidiaries.
In addition, the Company entered into a $415 million 4.5 year
syndicated secured credit facility pursuant to a term Credit
Agreement among the Company, as Borrower, Credit Suisse AG, Cayman
Islands Branch, as Administrative Agent and Collateral Agent,
Credit Suisse Securities (USA) LLC, Wells Fargo Securities, LLC,
Barclays Bank PLC, BMO Capital Markets and SunTrust Robinson
Humphrey, Inc., as Joint Lead Arrangers and Joint Bookrunners,
Wells Fargo Bank, N.A., Barclays Bank PLC, Bank of Montreal and
SunTrust Bank as Co-Documentation Agents, and the other Lenders
party thereto. Under the Term Credit Facility, the Company made a
single drawing of $415 million on the Closing Date. The Company may
request an additional term loan of up to $100 million, plus an
unlimited amount under certain terms and conditions set forth in
the Term Credit Facility.
The ABL Credit Facility and the Term Credit Facility replace the
Credit Agreement dated as of February 25, 2010 among the Company,
Bank of America, N.A., as Administrative Agent, and the other
agents and lenders party thereto, which terminated on February 19,
2014.
The notes sold by the Company have not been registered under the
Securities Act of 1933, as amended, or the Securities Act, or under
any state securities law and may not be offered or sold in the
United States absent registration or an applicable exemption from
registration under the Securities Act and applicable state
securities laws. The notes were sold only to qualified
institutional buyers under Rule 144A and outside the United States
in compliance with Regulation S under the Securities Act. This
press release does not constitute an offer to sell any security and
shall not constitute an offer, solicitation or sale in any
jurisdiction in which such offering would be unlawful.
About Diamond Foods
Diamond Foods is an innovative packaged food company focused on
building and energizing brands including Kettle® Chips, Emerald®
snack nuts, Pop Secret® popcorn, and Diamond of California® nuts.
Diamond's products are distributed in a wide range of stores where
snacks and culinary nuts are sold. For more information, visit the
Company's corporate web site: http://www.diamondfoods.com.
Note Regarding Forward-looking Statements
Statements included in this press release which are not
historical facts are forward looking statements including
statements about improving financial flexibility. These
forward-looking statements are based on our assumptions and
expectations only as of the date of this press release. We use the
words "anticipate," "believe," "estimate," "expect," "intend,"
"plan," "seek," "may" and other similar expressions to identify
forward-looking statements about our future expectations,
projections of future results or financial condition, or other
"forward-looking" information. You should carefully consider
cautionary statements in this press release and under the "Risk
Factors" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" sections of the periodic
reports that we file from time to time with the SEC. We do not
undertake any obligation to update forward-looking statements to
reflect events or circumstances occurring after the date of this
press release. Therefore, the actual results of operations or
financial condition of the Company could differ materially from
those expressed or implied in such forward looking statements.
Actual results may differ materially from what we currently
expect because of many risks and uncertainties, such as:
unexpected delays or increased costs in implementing our
business strategies; changes in consumer preferences for snack and
nut products; risks relating to our leverage, including the cost of
our debt and its effect on our ability to respond to changes in our
business, markets and industry; the dilutive impact of equity
issuances; risks relating to litigation and regulatory proceedings;
uncertainties relating to our relations with growers; availability
and cost of walnuts and other raw materials; increasing competition
and possible loss of key customers; and general economic and
capital markets conditions. Actual results may differ materially
from what we currently expect because of many risks and
uncertainties, such as: unexpected delays or increased costs
in implementing our business strategies; changes in consumer
preferences for snack and nut products; risks relating to our
leverage, including the cost of our debt and its effect on our
ability to respond to changes in our business, markets and
industry; the dilutive impact of equity issuances; risks relating
to litigation and regulatory proceedings; uncertainties relating to
our relations with growers; availability and cost of walnuts and
other raw materials; increasing competition and possible loss of
key customers; and general economic and capital markets
conditions.
CONTACT: Investors
ICR
Katie Turner
415-230-7952
Media
ICR
Anton Nicholas/Jessica Liddell
415-445-7431
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