Advance Auto Parts to borrow $500 million under $1 billion revolver

By Rebecca Melvin

New York, March 20 – Advance Auto Parts, Inc. has provided notice that the company would borrow $500 million under its $1 billion revolving credit facility of Jan. 31, 2017, according to an 8-K filing with the Securities and Exchange Commission.

The company informed Bank of America, NA as administrative agent on March 17.

The borrowing is aimed at increasing the company’s cash position and preserving financial flexibility in light of current uncertainty in global financial markets. The proceeds of the new borrowing may be used for working capital, ongoing operating needs and general corporate purposes.

As previously reported, the revolver includes a $200 million sublimit for letters of credit, and total commitments may be increased by up to $250 million.

The facility matures in January 2022 but may be extended by up to two one-year periods.

Initial interest was Libor plus 110 basis points. The spread over Libor ranges from 91 bps to 150 bps, depending on debt ratings.

The facility fee was 15 bps initially and ranges from 9 bps to 25 bps.

Advance Auto is a Roanoke, Va.-based specialty retailer of automotive aftermarket parts, accessories, batteries and maintenance items.

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