Federal-Mogul Corporation FDML today announced that it has engaged J.P. Morgan Securities LLC and Wells
Fargo Capital Finance, LLC to arrange certain amendments to its existing
credit facility pursuant to which the Company's asset based revolving loan
facility would be increased and its maturity extended from 2013 to 2017.
JPMorgan Chase Bank, N.A. and Wells Fargo Bank, National Association have each
agreed to commit $125 million to the new revolving facility, subject to
certain conditions. In addition, the Company is seeking to extend the maturity
of approximately $1.8 billion of term loans outstanding under the credit
facility from 2014 to 2016, and certain other modifications to the facility
would be effected. To facilitate this refinancing effort, the Company has
entered into an Investment Agreement pursuant to which it will issue
approximately $150 million of common stock to a subsidiary of Icahn
Enterprises L.P., the Company's largest stockholder of record, in a private
placement exempt from registration under the Securities Act of 1933. In
addition, the Company has also agreed to commence a subsequent rights offering
of $150 million to shareholders of record. Icahn Enterprises has agreed to
backstop the rights offering. The refinancing plan is conditioned upon a
voluntary prepayment by the Company of up to $300 million of the extended term
loans. The equity investment and existing cash balances will be used to fund
such prepayment. The refinancing plan and private placement are expected to be
consummated in the fourth quarter of 2012.
These refinancing transactions are subject to various conditions. No
assurances can be given that the transactions will be completed on the terms
set forth herein or at all.
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