Set-top box maker and audiovisual specialist Technicolor has successfully repriced more than US$1bn of term loans as part of its strategy to increase its ability to pursue inorganic growth opportunities.
The Paris based firm secured an agreement with…
Set-top box maker and audiovisual specialist Technicolor has successfully repriced more than US$1bn of term loans as part of its strategy to increase its ability to pursue inorganic growth opportunities.
The Paris based firm secured an agreement with its lending banks, JP Morgan, Goldman Sachs and Morgan Stanley, to adjust the terms and conditions of its US$763m and €301m (US$339m) of senior secured term loans maturing 2020.
The loans, issued by subsidiary Tech Finance & Co, now pay 400bp over Libor and 400bp over Euribor respectively. This represents a 50 basis point reduction from the existing pricing and the reduced interest rate will result in around €5m of annual cash interest savings.
Possibly more important is that the new terms give Technicolor additional operating flexibility, reducing its restrictions on raising new debt and increasing its leverage requirements from 3.5x to 4x gross debt to EBITDA.
This will help support the company’s strategic plan, Drive 2020, which intends to pursue external growth opportunities including acquisitions.
