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RBC Capital Markets Arranges $300MM Facility to Support LMI Acquisition

January 02, 2013, 08:05 AM

LMI Aerospace, a supplier of structural assemblies, kits and components and provider of design engineering services to the aerospace and defense industries, announced that it completed its acquisition of Valent Aerostructures on December 28, 2012. Headquartered in Kansas City, MO, Valent is a provider of complex, structural components, major sub-assemblies and machined parts for OEM and Tier 1 airframe manufacturers in the aerospace and defense industries.

Concurrently, and in connection with entering into the Purchase Agreement, the company entered into a debt financing commitment letter with Royal Bank of Canada, pursuant to which, subject to the conditions set forth therein, RBC Capital Markets has committed to arrange, and Royal Bank has committed to provide to the company, senior secured credit facilities in an aggregate principal amount of up to $300.0 million comprising (i) a revolving credit facility of $75.0 million and (ii) a term loan facility of up to $225.0 million. RBCCM will act as sole lead arranger and book running manager, and Royal Bank will act as the sole administrative agent, sole collateral agent and letter of credit issuing lender, in each case, in respect of the facilities.

The proceeds of the term loan facility will be used: (a) to pay the cash consideration for the acquisition, (b) for the repayment of substantially all existing indebtedness of the company and Valent and (c) for the payment of the fees and expenses related to the acquisition, refinancing and closing of the facilities. The proceeds of the revolving facility will be used for working capital needs and other general corporate purposes of the company, including financing of permitted acquisitions.

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