GenTek expects negotiations to amend credit facility will continue through Q2

By Sara Rosenberg

New York, May 15 - GenTek Inc. expects negotiations over an amendment of its credit facility to eliminate defaults will continue through the second quarter of 2002, according to a company press release.

The company received a notice of default on March 31 "based upon the independent auditors' explanatory paragraph" in the 2001 year-end financial statements, the release said. Additionally, for the first quarter 2002, the Hampton, N.H. communications, manufacturing and performance products company was not in compliance with certain financial covenants under its senior credit facility.

Due to the defaults, GenTek's outstanding eurodollar loans are being converted to prime rate-based loans, the release said. After the conversion, which should be completed by October, the average effective interest rate on the senior credit facilities is expected to increase by about 140 basis points.

At March 31, total cash balances were $148.8 million and total debt was $979.8 million.

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