Applied Industrial gets $250 million revolver, $125 million term loan

By Wendy Van Sickle

Columbus, Ohio, Dec. 28 – Applied Industrial Technologies, Inc. entered into a five-year $375 million unsecured credit facility with KeyBank NA, as lead arranger, bookrunner and administrative agent on Dec. 22, according to an 8-K filed with the Securities and Exchange Commission.

The agreement provides for a $250 million revolving credit facility and a $125 million term loan. Commitments may be expanded by up to an additional $100 million.

Revolving borrowings initially bear interest at Libor plus 87.5 basis points and term borrowings at Libor plus 100 bps. The margin can range from 66 bps to 132.5 bps for the revolver and 75 bps to 150 bps for the term loan, depending on leverage ratio

The facility fee is initially 12.5 bps and can range, depending on leverage ratio, from 9 bps to 17.5 bps.

U.S. Bank NA, PNC Bank, NA and JPMorgan Chase Bank, NA are the co-syndication agents.

Applied Industrial must maintain a maximum interest coverage ratio of 3 times and a leverage ratio of 3.25 times, or 3.5 times for a one-year period on up to two occasions in connection with certain acquisitions costing at least $50 million.

Proceeds may be used for working capital needs and general corporate purposes, including acquisitions.

The agreement replaced a $150 million credit agreement dated May 15, 2012 and a $100 million agreement dated April 25, 2014, both with KeyBank NA as agent.

Applied Industrial is an industrial distributor based in Cleveland.

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