PetIQ amends credit agreements for $330 million of facilities

By Sarah Lizee

Olympia, Wash., July 9 – PetIQ, Inc. and its domestic subsidiaries amended their revolving credit agreement and term loan agreement on Sunday in connection with the closing of PetIQ’s acquisition of Perrigo Animal Health, according to an 8-K filing with the Securities and Exchange Commission.

The acquisition was for $185 million in cash, financed through a combination of $25 million of existing cash on hand, $145 million of new term loan financing from Ares Capital Management, with the remaining balance financed through PetIQ’s existing revolving credit facility with East West Bank.

The size of the revolving facility was increased to $110 million with an accordion feature allowing an additional increase up to $125 million.

The maturity date of the revolving facility was extended to July 8, 2024.

In addition, the interest rate for the revolver was reduced to Libor plus 175 basis points.

The amendment also modified some financial covenants, including eliminating the maximum first-lien net coverage ratio.

The amended term loan agreement provides for a secured term loan facility of $220 million maturing on July 8, 2025, the proceeds of which were used to refinance the existing term loan facility and complete the acquisition.

The term loan bears interest at Libor plus 450 bps.

The term loan agreement requires compliance with a maximum first-lien net leverage ratio.

Based in Eagle, Idaho, PetIQ is a pet health and wellness company.

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