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Merrill Lynch, Others Provide Financing in A&E’s Recapitalization

July 20, 2015, 07:29 AM
Filed Under: Manufacturing

KPS Capital Partners announced its portfolio company American & Efird Global (A&E) has completed a successful recapitalization.  A&E raised approximately $275 million of financing, including a $65 million cash flow revolving credit facility and an approximately $210 million term loan.  The proceeds of the recapitalization were used to refinance outstanding debt, to fund an $80 million cash distribution to stockholders and to support the Company's continued growth.

Following the recapitalization, A&E remains conservatively capitalized with the continued support of its controlling stockholder, KPS, a private equity firm with approximately $5.6 billion of assets under management.

Fred Jackson, Chief Executive Officer of A&E, said, "A&E's successful recapitalization validates the incredible transformation A&E has experienced under KPS ownership, and we are pleased to return capital to our stockholders.  The company's momentum and trajectory are extraordinary.  Under KPS ownership, A&E has purchased Gutermann, one of the world's leading manufacturers and distributors of premium, high-quality sewing thread products for consumer and industrial applications, as well as full control of several of the Company's joint ventures located throughout Asia.  Our conservative capital structure and the financial support of our stockholders provide us with the resources to support the Company as it continues to successfully expand into adjacent geographies, products and end-markets, both organically and through acquisitions.  Following the recapitalization, A&E remains committed to providing the highest levels of product quality, environmental sustainability, technological innovation and customer service.  We thank our customers, suppliers and employees for their contributions to our success." 

Financing for the recapitalization was provided by a group of lenders with Merrill Lynch, Pierce, Fenner & Smith Incorporated serving as Joint Left Lead Arranger and Bookrunner, and HSBC Bank USA, N.A., J.P. Morgan Securities LLC and PNC Capital Markets LLC acting as Joint Right Lead Arrangers and Joint Bookrunners. 

Paul, Weiss, Rifkind, Wharton & Garrison LLP served as legal counsel to A&E with respect to the recapitalization.

A&E is the largest U.S. manufacturer and the world's second largest manufacturer and distributor of premium quality industrial and consumer sewing thread, embroidery thread and technical textiles for the apparel, automotive components, home furnishings, medical supply, footwear and diversified industrial markets marketed under the A&E and Gutermann brand names. A&E owns or operates 28 manufacturing facilities in 23 countries and employs over 9,000 associates around the world directly or in partnership with joint venture partners.

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