Jeld-Wen wants to extend term loan, ABL facility, lower interest rates

By Angela McDaniels

Tacoma, Wash., Dec. 4 – Jeld-Wen, Inc. is seeking amendments to its term loan and asset-based revolving credit facility dated Oct. 15, 2014, according to an 8-K filed with the Securities and Exchange Commission by parent company Jeld-Wen Holding, Inc.

For the term loan, the company wants to extend the maturity date to December 2024 and reduce the interest rates.

For the ABL facility, the company wants to extend the maturity date of the commitments to December 2022, reduce the interest rates for amounts drawn and make certain adjustments to the borrowing base and collateral.

For both facilities, the company wants amendments to provide for additional covenant flexibility and additional flexibility under the incremental facility.

Bank of America, NA is the administrative agent for the term loan, and Wells Fargo Bank, NA is the administrative agent for the ABL facility.

The company plans to price $400 million of senior notes due 2025 and $400 million of senior notes due 2027 and use the proceeds, together with cash on hand, to partially repay its outstanding debt under the term loan and for general corporate purposes.

Following the paydown, the company expects to have no revolving borrowings outstanding under the ABL facility and $440 million outstanding under the term loan.

If the company completes the refinancing transactions, it plans to terminate its existing interest rate swaps and enter into new interest rate swaps that involve the exchange of floating-rate interest payments for fixed-rate interest payments in order to reduce interest rate volatility.

As of Sept. 30, on a pro forma basis after giving effect to the note offering, the expected borrowings under the credit facilities and the use of proceeds, the company would have had about $440.4 million of secured debt and an additional $273.3 million of unused asset-based revolving credit loan capacity under the credit facilities, without giving effect to about $36.7 million of outstanding letters of credit at Sept. 30 on a pro forma basis.

As of Sept. 30, on a pro forma basis giving effect to the refinancing transactions and the notes offering, the company would have had $236.6 million available for borrowing under the ABL facility due 2022.

The company said that assuming the credit facilities are fully drawn, each quarter-point increase in interest rates on its debt service obligations on any variable-rate debt would result in a $1.85 million increase in total annual interest expense.

Jeld-Wen is a door and window manufacturer based in Charlotte, N.C.

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