A. M. Castle & Co., a global distributor of specialty metal and supply chain solutions, announced that it has closed an expansion of its existing credit facility to increase its borrowing capacity by $25 million.
Specifically, Castle reached an agreement with its first lien lender, PNC Bank, National Association, to provide the additional borrowing capacity under its existing first lien credit facility. The expanded Credit Facility provides for an additional $25 million last out Revolving B borrowing capacity made available in part by way of a participation in the Credit Facility by certain of the Company’s stockholders.
President and CEO Steve Scheinkman commented, “The expanded Credit Facility will immediately increase Castle’s liquidity, enhancing the Company’s ability to serve and grow with our customers’ businesses, as well as by our ability to capitalize on strengthening volumes, end markets, and pricing. Moreover, the enhanced liquidity will allow us to evaluate additional capital expenditure and strategic opportunities. We appreciate this strong showing of support by our stockholders and PNC.”
Lead independent director Jonathan Segal, of Highbridge Capital Management, LLC, one of the Company’s largest stock and debt holders, added, “As stakeholders, we are encouraged by the Castle team’s execution against the Company’s strategy since its emergence from bankruptcy last fall. We are particularly pleased with the recent improvements in the Company’s volumes, end-markets, and pricing. We believe the expanded Credit Facility is an important demonstration of stakeholder support of the Company’s progress that will facilitate the Company’s continued execution of its strategic priorities.”
In connection with the Credit Agreement amendment, the Company entered into a Supplemental Indenture and Amendment No. 1 to the Indenture securing its 5%/7% Second Lien Notes The Supplemental Indenture, among other things, increases the cap on indebtedness under the expanded Credit Facility to $175 million (plus up to an additional $15 million), as set forth in the Supplemental Indenture.