LMI Aerospace plans $300 million credit facility for Valent purchase

By Sara Rosenberg

New York, Dec. 6 - LMI Aerospace Inc. has received a commitment for a $300 million senior secured credit facility to fund its acquisition of Valent Aerostructures LLC, refinance existing debt and provide for working capital needs, according to an 8-K filed with the Securities and Exchange Commission on Thursday.

RBC Capital Markets is the lead arranger and bookrunner on the deal.

The facility consists of a $75 million five-year revolver and a $225 million six-year term loan.

Pricing on both tranches is expected at Libor plus 475 basis points, with the term loan having a 1.25% Libor floor. The revolver includes a 50 bps unused fee.

The term loan has 101 soft call protection for one year and amortizes at a rate of 1% per annum.

Financial covenants include a total net leverage ratio and an interest coverage ratio.

Under the agreement, Valent is being purchased for about $237 million, plus around $9.7 million of certain retained obligations.

Closing is expected by Dec. 31, subject to regulatory approvals.

LMI Aerospace is a St. Charles, Mo.-based supplier of structural assemblies, kits and components and provider of design engineering services to the aerospace and defense industries.

Valent is a Kansas City, Mo.-based provider of complex, structural components, major sub-assemblies and machined parts for OEM and Tier 1 airframe manufacturers.

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