McDonald’s gets $1 billion 364-day revolving credit facility

By Wendy Van Sickle

Columbus, Ohio, March 26 – McDonald’s Corp. entered into and fully borrowed a $1 billion 364-day revolving credit agreement on Wednesday, according to an 8-K filing with the Securities and Exchange Commission.

JPMorgan Chase Bank, NA is administrative agent.

The credit agreement expires on March 24, 2021.

The proceeds may be used for general corporate purposes.

The company said it obtained the credit agreement as a precautionary measure to bolster its cash position and provide financial flexibility in light of uncertainty resulting from the Covid-19 pandemic.

McDonald’s also has available to it the full $3.5 billion commitment under its revolving credit agreement that was entered in December 2018.

The 2018 credit agreement expires Dec. 4, 2024.

Borrowings under the new revolver bear interest at Libor plus 87.5 basis points to 100 bps, depending on the company’s ratings.

There is a fee of 37.5 bps on undrawn commitments.

McDonald’s may borrow, prepay and reborrow amounts under the new credit agreement at any time during its term.

The fast food chain is based in Chicago.

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