Dixie Group obtains new $150 million credit facility

By Sara Rosenberg

New York, May 15 - The Dixie Group, Inc. entered into a new $150 million credit facility, which will be used to refinance the previous loan and replace the accounts receivable securitization program. Fleet Capital was the lead arranger for the deal, according to a company spokesman.

The Chattanooga, Tenn. carpet and rug manufacturer's new loan consists of a $110 million five-year revolver and a $40 million five-year term. Interest rates for both tranches can range from Libor plus 225 basis points to 350 basis points, based on the company's leverage ratio, the spokesman said. There is an unused commitment fee on the revolver that ranges from 37.5 basis points to 50 basis points. Substantially all assets are being used to secure the loan.

"A major focus of our strategy has been debt reduction. Since the high point of our debt in August 2000, through May 14, 2002, we have reduced debt, including amounts advanced under our accounts receivable securitization program, by almost $100 million," said Daniel Frierson, chairman and chief executive officer, in a news release.

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