By Susanna Moon
Chicago, Oct. 20 – EXCO Resources, Inc. said it has lined up a $300 million 12˝% five-year senior secured second-lien term loan at par from subsidiaries of Fairfax Financial Holdings Ltd.
Proceeds of the Fairfax term loan will be used to repay some borrowings under the company’s credit agreement.
The term loan is part of the company’s larger strategic improvement plan intended to bolster its balance sheet and its financial flexibility, according to a company press release.
The company also will repurchase $577 million of senior notes at an average price of 51% of par, in return for a 12˝% five-year term loan.
The company also amended its credit agreement to reduce the borrowing base to $375 million and to provide more covenant flexibility.
The transactions are expected to reduce net debt by $270 million, or by 18%, to extend weighted average debt maturity by 30% to 4.7 years and to improve forward cash flow by about $146 million, the company said.
Credit Suisse Securities (USA) LLC is the restructuring adviser.
EXCO is a Dallas-based oil and natural gas company.
| Issuer: | EXCO Resources, Inc.
|
| Issue: | Senior secured second-lien term loan
|
| Amount: | $300 million
|
| Maturity: | Five years
|
| Coupon: | 12˝%
|
| Price: | Par
|
| Investor: | Fairfax Financial Holdings Ltd. subsidiaries
|
| Settlement date: | Oct. 26
|
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