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Xerium Announces Refinancing to Support Ongoing Restructuring, Growth Initiatives

May 20, 2013, 08:00 AM
Filed Under: Manufacturing

Xerium Technologies, a leading global provider of industrial consumable products and services, has refinanced its existing term loan and revolving credit facility with the proceeds of a new term loan arranged by Jefferies and Credit Suisse. Xerium remains focused on executing its global restructuring initiatives and the terms of the new credit facilities provide management with the flexibility to pursue these initiatives as well as pursue new growth opportunities.

The refinancing transaction includes the following:

  • A new $200 million “covenant lite” term loan credit facility replacing the existing multi-currency term loan
  • A new $40 million U.S. and Canadian asset-based revolving line of credit replacing the existing $30 million multi-currency revolving line of credit

Key terms of the new financing include the following:

  • Increased borrowing capacity and approximately 400 basis point decrease in interest rates under the new asset-based revolving line of credit
  • A 25 basis point increase in interest rates over the life of the term loan as compared to the prior term loan
  • Elimination of quarterly financial maintenance ratio tests
  • Increased capacity for capital expenditures, restructuring and acquisitions as compared to the prior term loan

Harold Bevis, Xerium's President and Chief Executive Officer, stated, "We are thankful to our lender group for supporting Xerium’s ongoing operational improvement initiatives. The new capital structure allows us to implement what we believe are game-changing improvements to our business. We are now poised to accelerate some of our planned activities.”

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