Flowserve downsizes revolver to $800 million, makes other changes

By Wendy Van Sickle

Columbus, Ohio, July 7 – Flowserve Corp. amended its existing credit agreement dated Aug. 20, 2012 to reduce the revolving credit commitment to $800 million from $1 billion among other changes, according to an 8-K filing with the Securities and Exchange Commission.

Additionally, the June 30 amendment

• Revises the restrictions on the company’s ability to incur debt, specifically to cut the maximum principal amount of priority debt allowed to 7.5% from 15% of the consolidated tangible assets of the company and to decrease the maximum amount of receivables the company can securitize to $100 million from $200 million;

• Increases the consolidated leverage ratio to 4.00 to 1.00 from 3.50 to 1.00 through June 30, 2019, when it will decrease to 3.75 to 1.00; and

• Increases the interest rate margin for Libor loans to 200 basis points from 175 bps if the company’s non-credit enhanced, senior unsecured long-term debt rating of Moody’s/S&P is Ba2/BB or worse.

Bank of America, NA is the swingline lender, letter-of-credit issuer and administrative agent for the credit facility.

The flow control systems manufacturer is based in Irving, Texas.

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