AK Steel gets $1 billion five-year revolver at Libor plus 200 bps

By Angela McDaniels

Tacoma, Wash., April 29 - AK Steel Corp. entered into a new $1 billion five-year revolving credit facility on Thursday, according to an 8-K filing made with the Securities and Exchange Commission by parent company AK Steel Holding Corp.

The initial interest rate is Libor plus 200 basis points. The spread will vary from 175 bps to 250 bps depending on availability. The commitment fee is 50 bps if the average daily balance of borrowings is $500 million or less and 37 bps if it exceeds $500 million.

Availability is based on a valuation of the company's eligible inventories and accounts receivable.

Bank of America Merrill Lynch, J.P. Morgan Securities LLC and Wells Fargo Capital Finance, LLC are the joint lead arrangers and bookrunners. JPMorgan Chase Bank, NA and Wells Fargo Capital Finance, LLC are the syndication agents. Citibank, NA and Deutsche Bank Securities Inc. are the documentation agents. Bank of America, NA is the agent.

The revolver has a $75 million swingline sublimit and a $300 million letter-of-credit sublimit.

There is a $300 million accordion feature.

At closing, the company had $200 million of outstanding borrowings under the revolver and $155.2 million of outstanding letters of credit.

Borrowings will be used for general corporate purposes.

The new credit facility replaces the company's existing $850 million senior secured revolving credit facility, which was set to expire in February 2012.

AK Steel produces flat-rolled carbon, stainless and electrical steels and is based in West Chester, Ohio.

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