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Forward Air gets $1.85 billion debt commitment for Omni buy
By Sara Rosenberg
New York, Aug. 10 – Forward Air Corp. has obtained commitments for up to $1.85 billion of debt consisting of term and bridge loans to support its acquisition of Omni Logistics LLC from Ridgemont Equity Partners and EVE Partners LLC, according to a news release.
Under the agreement, Omni shareholders will receive $150 million in cash and Forward common stock and perpetual non-voting convertible preferred stock. At the closing of the transaction, Omni shareholders will own 37.7% of the combined company on a fully-diluted, as-converted basis.
Proceeds from the new debt will be used with cash on hand to refinance existing debt at both companies and to pay the consideration and other amounts in connection with the transaction.
The company also has a commitment for an upsized $400 million revolving credit facility to help fund the combined company’s working capital requirements going forward.
The combined company’s leverage ratio is expected to be about 3.5x based on combined company adjusted EBITDA, inclusive of run-rate cost synergies, for the 12 months ended June 30. The plan is to deleverage to around 2x within about two full years post-close.
Closing is expected in the second half of this year, subject to the receipt of regulatory approvals and other customary conditions.
Morgan Stanley & Co. LLC and Citi are serving as financial advisers to Forward Air, and Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC are serving as financial advisers to Omni.
Forward Air is a Greeneville, Tenn.-based provider of transportation services. Omni is a Dallas-based logistics and supply chain management company.
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