Pentair amends, expands credit facility to $1.1 billion

By William Gullotti

Buffalo, N.Y., Dec. 20 – Pentair plc and subsidiaries Pentair Finance Sarl, and Pentair, Inc. entered into an amended and restated credit agreement totaling $1.1 billion on Dec. 16, according to an 8-K filing with the Securities and Exchange Commission.

The facility is divided into a $900 million senior revolver maturing Dec. 16, 2026 and a $200 million senior term loan maturing Dec. 16, 2024.

Pentair Finance has the option to request to further increase the credit facility by up to $300 million via increases to the revolver and/or one or more tranches of additional term loans.

An aggregate total of $430 million remained outstanding when the agreement was restated.

Voluntary prepayment is permitted without penalty on each part of the facility and will not be considered mandatory unless certain affiliate and currency sub-limits are exceeded, subject to certain exceptions.

The facilities also contain financial covenants requiring Pentair to not permit the ratio of its consolidated debt to exceed 3.75x, which may be raised to 4.25x for four testing periods at the option of Pentair in connection with certain material acquisitions, and the ratio of its EBITDA to its consolidated cash interest expense for the same period to be less than 3x.

The Eurocurrency spread varies between 90 basis points and 140 bps for revolving loans.

For term loans, the spread will be between 75 bps and 150 bps.

The margin will be based on, at the company’s election, Pentair’s leverage level or public credit rating. In addition, the company will pay a quarterly fee based on the average daily amount of the revolver, used or unused, based upon the same conditions.

The facility fee is between 10 bps and 22.5 bps.

J.P. Morgan Chase Bank, NA is the administrative agent.

Bank of America, NA, MUFG Bank, Ltd. and U.S. Bank NA are the syndication agents.

PNC Bank, NA, Wells Fargo Bank, NA, Bank of Montreal, London Branch and Banco Bilbao Vizcaya Argentaria, SA, New York Branch are the documentation agents.

JPMorgan, BofA Securities, Inc., Citibank, NA, MUFG, and U.S. Bank are also serving as joint bookrunners and joint lead managers.

Pentair is a water technology company based in London and has three reportable business segments: aquatic systems, filtration solutions and flow technologies.

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