Federated Investors enters $375 million five-year restated revolver

By Marisa Wong

Morgantown, W.Va., June 5 – Federated Investors, Inc. entered into a third amended and restated credit agreement on Monday with a syndicate of 10 banks led by PNC Capital Markets LLC as bookrunner, PNC Capital Markets and Citigroup Global Markets, Inc. as joint lead arrangers, PNC Bank, NA as administrative agent, Citibank, NA as syndication agent and TD Bank, NA as documentation agent, according to an 8-K filing with the Securities and Exchange Commission.

The credit agreement amends and restates Federated’s prior second amended and restated credit agreement dated June 24, 2014 and set to mature on June 24, 2019.

The new credit agreement refinances the $200 million revolving credit facility and $178.5 million outstanding term loan borrowings under the prior agreement, replacing both with a $375 million revolver that includes a $200 million accordion feature. Federated had no borrowings under the previous revolver. The new credit agreement does not include a term loan.

The new facility expires on June 5, 2022.

Borrowings bear interest at Libor plus a spread. The interest rate is projected to be about 2.17% for the third quarter of 2017. The commitment fee under the facility currently is projected to be 12.5 basis points. General pricing terms were not disclosed in the 8-K.

The credit agreement, similar to the prior agreement, includes an interest coverage ratio covenant and a leverage ratio covenant. Federated was in compliance with all covenants as of Monday, the filing noted.

Federated Investors is a Pittsburgh-based fund manager.

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