Stoneridge to redeem all $157.5 million 9½% notes via new revolver

By Toni Weeks

San Luis Obispo, Calif., Sept. 15 – Stoneridge, Inc. said it will issue a call to redeem its $157.5 million outstanding 9½% senior secured notes in mid-October, according to a press release.

Under the indenture, the notes are redeemable on or after Oct. 15 at 104.75 plus accrued interest. The company will fund the redemption with the proceeds of a new $300 million senior secured revolving credit facility, which it obtained last Friday.

The company expects cash interest saving generated in the fourth quarter of 2014 to be about $3 million, or $0.11 per share, compared with the prior-year interest expenses, excluding the write-off of deferred financing fees and note discount.

“The refinancing of our notes lowers our debt balance and significantly reduces our interest costs,” president and chief executive officer John C. Corey said in the release.

“In addition to a lower Stoneridge debt balance and reduced interest expenses, our new credit facility will add flexibility to our capital structure, which will allow us to better utilize our cash balances to reduce interest expenses while simultaneously allowing us the ability to borrow for acquisitions if needed, though our primary near-term objective will be to continue to reduce debt.”

Warren, Ohio-based Stoneridge is a designer and manufacturer of highly engineered electrical and electronic components, modules and systems primarily for the automotive, commercial vehicle, motorcycle and off-highway vehicle markets.

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