Ducommun Completes New Credit Agreement
29 June 2015 - 9:01PM
Business Wire
Provides Enhanced Flexibility and Significantly
Reduces Interest Expense Going Forward
Ducommun Incorporated (NYSE: DCO) (“Ducommun” or the “Company”)
today announced that, effective June 26, 2015, it has entered into
a new $475 million credit agreement (the “New Credit Agreement”) –
consisting of a $200 million revolving credit facility and a $275
million term loan facility – to replace its existing debt
structure. In connection with the transaction, the Company has
repaid an existing $80 million term loan and called $200 million of
outstanding 9.75% senior unsecured notes due 2018.
The New Credit Agreement includes a significantly lower variable
interest rate on borrowings than the debt it replaces and has a
final maturity date of June, 2020. The variable interest rate on
the New Credit Agreement will initially be LIBOR plus 2.50%,
subject to adjustments based on the Company’s leverage ratio. The
Company estimates that the effective interest rate upon closing is
approximately 3.50%.
“We’re very pleased to announce this new credit agreement, which
will decrease our interest expense and improve our net income
significantly,” said Anthony J. Reardon, chairman and chief
executive officer. “We have been dedicated to reducing our debt,
lowering the Company’s leverage, and strengthening Ducommun’s
balance sheet for years. This refinancing positions the Company for
greater financial flexibility as well as higher returns for our
shareholders going forward.”
Detailed information regarding the New Credit Agreement is
included in the Company's Current Report on Form 8-K filed with the
Securities and Exchange Commission. Bank of America, N.A. acted as
Administrative Agent, Swingline Lender and L/C Issuer; Wells Fargo
Bank, N.A. acted as Syndication Agent; and General Electric Capital
Corporation, BBVA Compass Bank and MUFG Union Bank, N.A. acted as
Documentation Agents for the New Credit Agreement. Bank of America
Merrill Lynch, Wells Fargo Securities, LLC and GE Capital Markets
also served as joint lead arrangers and joint book runners.
About Ducommun Incorporated
Founded in 1849, Ducommun Incorporated provides engineering and
manufacturing services to the aerospace, defense, and other
industries through a wide spectrum of electronic and structural
applications. The company is an established supplier of critical
components and assemblies for commercial aircraft and military and
space vehicles as well as for the energy market, medical field, and
industrial automation. It operates through two primary business
units – Ducommun AeroStructures (DAS) and Ducommun LaBarge
Technologies (DLT). Additional information can be found at
www.ducommun.com.
Statements contained in this press release regarding other than
recitation of historical facts are forward-looking statements.
These statements are identified by words such as “may,” “will,”
“begin,” “look forward,” “expect,” “believe,” “intend,”
“anticipate,” “should”, “potential,” “estimate,” “continue,”
“momentum” and other words referring to events to occur in the
future. These statements reflect the Company’s current view of
future events and are based on its assessment of, and are subject
to, a variety of risks and uncertainties beyond its control,
including, but not limited to, the state of the world financial,
credit, commodities and stock markets, and uncertainties regarding
the Company, its businesses and the industries in which it
operates, which are described in the Company’s filings with the
Securities and Exchange Commission. The Company is under no
obligation to (and expressly disclaims any such obligation to)
update or alter its forward-looking statements whether as a result
of new information, future events or otherwise.
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version on businesswire.com: http://www.businesswire.com/news/home/20150629005256/en/
Ducommun IncorporatedJoseph P. BellinoVice President and Chief
Financial Officer310.513.7211orInvestor RelationsChris
Witty646.438.9385cwitty@darrowir.com
Ducommun (NYSE:DCO)
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