Generac Completes Refinancing of Senior Secured Credit Facility; Declares Special Cash Dividend of $6.00 Per Share
May 31 2012 - 7:00AM
Business Wire
Generac Holdings Inc. (NYSE: GNRC)(the “Company”), a leading
designer and manufacturer of generators and other engine powered
products, announced today that it has completed the previously
disclosed amendment and restatement of its existing senior secured
credit facilities, pursuant to which it has incurred $900 million
of senior secured term loans to replace its existing $575 million
term loan facilities. Additionally, the Company has obtained a
separate $150 million asset-based revolving credit facility to
replace its existing $150 million unfunded revolving credit
facility. The new term loans will mature in 2018, with interest
accruing at LIBOR plus 5.0% with a LIBOR floor of 1.25%. The new
revolving credit facility will terminate in 2017 and interest will
accrue on drawn proceeds using an availability-based pricing grid
starting at LIBOR plus 2.0%. As previously announced, the Company
intends to use the remaining proceeds from the new term loans and
cash on hand to fund a special cash dividend to its stockholders of
$6.00 per share, or approximately $408 million in the aggregate,
and to pay related financing fees and expenses.
Following the closing of the new senior secured credit facility
and related borrowings thereunder, the Company’s Board of Directors
yesterday declared the special cash dividend of $6.00 per share.
The special cash dividend is payable to stockholders of record on
June 20, 2012 and will be paid on June 29, 2012. We have been
informed by the New York Stock Exchange that the ex-dividend date
is expected to be July 2, 2012, in accordance with its rules.
Shareholders of record on the record date who sell their shares on
or before the payment date will not receive the special cash
dividend.
As a result of the closing on the $900 million of senior secured
term loans, the Company is updating its guidance for interest
expense for the full-year 2012. Interest expense is now expected to
be in the range of $49.0 to $50.0 million, which includes $45.0 to
$46.0 million of debt service costs, at current LIBOR rates, plus
approximately $4.0 million for deferred financing cost and original
issue discount amortization for the new credit facility. Interest
expense during the third quarter of 2012, the first full quarter
under the new capital structure, is expected to be approximately
$17.2 million, which includes approximately $1.4 million of
deferred financing costs and original issue discount
amortization.
Forward-looking Information
Certain statements contained in this news release, as well as
other information provided from time to time by Generac Holdings
Inc. or its employees, may contain forward looking statements that
involve risks and uncertainties that could cause actual results to
differ materially from those in the forward looking statements.
Forward-looking statements give Generac's current expectations and
projections relating to the Company's financial condition, results
of operations, plans, objectives, future performance and business.
You can identify forward-looking statements by the fact that they
do not relate strictly to historical or current facts. These
statements may include words such as "anticipate," "estimate,"
"expect," "project," "plan," "intend," "believe," "confident,"
"may," "should," "can have," "likely," "future" and other words and
terms of similar meaning in connection with any discussion of the
timing or nature of future operating or financial performance or
other events.
Any such forward looking statements are not guarantees, and
involve risks, uncertainties (some of which are beyond the
Company's control) and assumptions. Although Generac believes any
forward-looking statements are based on reasonable assumptions, you
should be aware that many factors could cause outcomes to differ
materially from those anticipated in any forward-looking
statements. With respect to the forward-looking statement regarding
future interest expense, one such factor is an unexpected increase
in LIBOR.
Any forward-looking statement made by Generac in this press
release speaks only as of the date on which it is made. Generac
undertakes no obligation to update any forward-looking statement,
whether as a result of new information, future developments or
otherwise, except as may be required by law.
SOURCE: Generac Holdings Inc.
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