Brown & Brown, Inc. (the "Company") BRO today announced its
entry into a five-year $1.35 billion unsecured credit facility. The
credit agreement provides for a revolving credit facility in an
aggregate amount up to $800 million and term loans in an aggregate
amount of $550 million. The Company may request, at the option of
participating lenders, an additional $500 million of funding capacity
within the facility. Interest is charged on a sliding net leverage
scale and will initially be priced at LIBOR plus 137.5 basis points.
The revolving facility is repayable in five years and the term loans
are repayable over the five-year term from the date of first funding,
which is expected to occur in May 2014 in connection with the closing
of the Company's previously announced acquisition of the Wright
Insurance Group.
R. Andrew Watts, Executive Vice President and Chief Financial
Officer, noted, "We are very pleased to have secured this new credit
facility, and we believe that its commercial and financial terms will
help position us well for funding our acquisitions and future growth.
We believe the significant level of interest to participate in the
facility demonstrates the support we have from our banking partners
and our strong financial position."
The facility is funded by a syndicate of financial institutions led
by JPMorgan Chase Bank, N.A., as administrative agent and bookrunner.
The other bookrunners on the facility are Bank of America, N.A.,
Royal Bank of Canada and SunTrust Bank. U.S. Bank is serving as a
lead arranger on the facility. The Company was advised by Evercore
Partners.
Funds will be drawn to finance the Wright Insurance Group
acquisition, refinance certain existing indebtedness of the Company
and for general corporate purposes, including the financing of future
acquisitions. This facility also includes various covenants,
limitations and events of default customary for similar facilities
for similarly rated borrowers. Additional information is available in
the Company's Current Report on Form 8-K, which will be filed with
the SEC within four business days of the date of this release.
Brown & Brown, Inc. (the "Company"), through its licensed
subsidiaries, offers a broad range of insurance and reinsurance
products and services, as well as risk management, third-party
administration, managed health care, and Medicare set-aside services
and programs. Providing service to business, public entity,
individual, trade and professional association clients nationwide,
the Company is ranked by Business Insurance magazine as the United
States' seventh largest independent insurance intermediary. The
Company's Web address is www.bbinsurance.com.
This press release may contain certain statements which are
forward-looking statements, including statements concerning the first
funding of the credit facility, the closing of the acquisition of the
Wright Insurance Group, the Company's belief that the new credit
facility's commercial and financial terms will help position the
Company well for funding its acquisitions and future growth and the
use of funds from the credit facility. These statements are not
historical facts, but instead represent only the Company's current
belief regarding future events, many of which, by their nature, are
inherently uncertain and outside of the Company's control. Further
information concerning the Company and its business, including
factors that potentially could materially affect the Company's
financial results and condition, as well as its other achievements,
are contained in the Company's filings with the Securities and
Exchange Commission. Some factors include: failure to close, or
unanticipated changes in the timing of the funding of, the credit
facility or the acquisition of the Wright Insurance Group;
unanticipated developments impacting our acquisition strategy, future
growth or both; fluctuations in our stock's market price;
fluctuations in operating results and cash flows; general economic
conditions around the country; downward commercial property and
casualty premium pressures; the effects of legislative and regulatory
changes in Florida pertaining to the insurance industry, including
those relating to coastal property coverages; the competitive
environment; the integration of the Company's operations with those
of businesses or assets the Company has acquired or may acquire in
the future and the failure to realize the expected benefits of such
integration; other factors that the Company may not have currently
identified or quantified; and other risks, relevant factors and
uncertainties identified in the Company's Annual Report on Form 10-K
for the year ended December 31, 2013, and the Company's other filings
with the Securities and Exchange Commission. All forward-looking
statements made herein are made only as of the date of this release,
and the Company does not undertake any obligation to publicly update
or correct any forward-looking statements to reflect events or
circumstances that subsequently occur or of which the Company
hereafter becomes aware.
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