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Columbus McKinnon withdraws stock offering to repay bank debt
By Sara Rosenberg
New York, Sept. 6 - Columbus McKinnon Corp. withdrew its registration statement for a follow-on offering of 5.25 million shares of common stock. Proceeds from the equity sale were expected to be used towards the reduction of debt under the company's credit facility.
"The current volatility in the public equity markets has convinced the Board of Directors that it would not be in the best interest of shareholders to proceed with the offering at this time," said Timothy T. Tevens, president and chief executive officer, in a news release. "We will re-evaluate the appropriateness of a follow-on offering when stock market conditions are more favorable."
Furthermore, the company anticipates completing negotiations on a new multi-year credit agreement within the next 60 days. The new facility would replace the existing credit agreement.
In June, Columbus McKinnon received a term sheet for a new $95 million credit facility due in 2006 to replace the existing loan maturing on March 31, 2003, according to a filing with the Securities and Exchange Commission. The interest rate on the new loan would be lower than the company's current interest rate on its existing loan.
In a conference call on May 21, officials said that the company is using the same lead bank from its existing bank loan, which was Fleet Bank, and anticipating a smaller syndicate.
Security for the credit facility will be a first priority security interest in all personal property, mortgages on certain real property and a pledge of the capital stock of subsidiaries, the filing said.
Columbus McKinnon, based in Amherst, N.Y., is a broad-line designer, manufacturer and supplier of sophisticated material handling products and integrated material handling solutions that are widely distributed to industrial and consumer markets worldwide.
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