Univar Solutions (UNVR) Wraps Up Offering Of Senior Notes
Zacks Investment Research | Nov 24, 2019 08:18PM ET
Univar Solutions Inc. (NYSE:UNVR) recently announced that its fully-owned subsidiary — Univar Solutions USA Inc. — has closed the offering of $500 million of 5.125% senior notes due 2027 on Nov 22, 2019.
The notes are treated as senior unsecured obligations of Univar Solutions USA. Further, the notes are guaranteed by Univar Solutions and its certain domestic subsidiaries.
Univar Solutions also stated that it has entered into a new USD term loan B facility worth $400 million. The facility was incurred by co-borrowers, Univar Netherlands Holding B.V. and Univar Solutions USA. This new-term loan facility will exist concurrent to the company's existing term loan facilities. Notably, these senior term facilities are treated as senior secured obligations of Univar Netherlands and Univar Solutions USA.
The company will utilize the net proceeds from the offering along with cash in hand and the proceeds of the borrowing under a new USD term loan B facility to repay debt. The company announced that it will redeem all of Univar Solutions USA's 6.75% senior notes due 2023.
Moreover, Univar Solutions will repay all the outstanding total principal amount of the existing Euro term B-2 loan facility and repay $100 million of the outstanding amount of the existing five-year senior secured ABL credit facility. The company will also pay any associated expenses and fees related to the foregoing.
Through this debt refinancing transaction, Univar Solutions is likely to save more than $20 million in the form of annual pre-tax cash interest expense and foreign exchange hedging costs.
While the new-term loan facility is slated to mature in 2026, the existing EUR term loan and the existing US ABL facility will mature in 2024. Similarly, the new notes will mature in 2027 compared with the existing notes that are due to mature in 2023.
Notably, Univar Solutions’ long-term debt rose 17% year over year to $2,977.1 million at the end of the third quarter. The company ended the third quarter with cash and cash equivalents of $134.6 million, up around 57% year over year.
Univar Solutions’ shares have gained 4.6% in the past year against the Original post
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