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Bank of America Agents $100MM Upsize for Calumet Specialty Products

September 09, 2019, 08:50 AM
Filed Under: Manufacturing
Related: Bank of Amercia

Calumet Specialty Products Partners, L.P., a producer of specialty hydrocarbon and fuels products, announced that it has successfully amended the terms of its existing asset-based loan facility to increase the borrowing base on the facility by approximately $100 million.  Bank of America, N.A., served as Agent for the Lenders. The Company may draw on this increased ABL capacity solely to fund a portion of the redemption of all of the outstanding 6.50% Senior Notes due 2021, with the remainder of the 2021 Notes being redeemed using proceeds from a new unsecured senior notes offering and cash on hand.  Upon the effectiveness of such borrowings under the ABL, the fixed assets associated with the Company's Great Falls, MT refinery would be added to the ABL collateral pool, which previously only included certain receivables and inventory. The increased borrowing base in the facility is available to consummate these proposed transactions through November 30.  See additional information in the 8-k filed today for additional details.

"The expansion of the ABL facility is a critical step as we work to position Calumet to potentially refinance its 2021 Notes in the unsecured bond market," stated Mr. Griffin.  "We are very appreciative of the strong support of all our bank group.  With this ABL amendment in place, we will continue to closely monitor the market conditions to identify the most attractive time to execute our refinancing."

Griffin continued, "If deployed in the near term, we expect that the $100 million of expanded capacity on the revolver, when combined with the $174 million of cash reported at the end of June and the anticipated free cash flow generated by the business, would enable the Company to retire the portion of the $810 million of 2021 Notes not otherwise refinanced.  We would expect to refinance the remaining approximately $500 million of 2021 Notes and to have approximately $300 million of liquidity before any refinancing fees, which we believe is more than adequate for the Company's operations."

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