MKS prepays $60 million of term loan, enters swap to fix rate at 4.7%

By Marisa Wong

Morgantown, W.Va., Oct. 3 – MKS Instruments, Inc. said it made a $60 million voluntary principal prepayment on its term loan.

The prepayment is in addition to a scheduled principal payment of $1.8 million and reduces the outstanding principal amount to $668 million as of Sept. 30.

The prepayment was made through a tax efficient repatriation of cash from international operations, according to a press release.

In addition, the company entered into an interest rate swap agreement to fix the rate on roughly 50% of its remaining term loan balance. The swap converts the floating rate on $335 million of the outstanding principal amount to a fixed interest rate of 4.7% through September 2020.

“This represents our second voluntary term loan prepayment in the last four months, bringing our total voluntary prepayments to $110 million, and demonstrates our continued commitment to deleveraging our balance sheet and minimizing our cost of capital,” Seth H. Bagshaw, vice president and chief financial officer, said in the release.

“The execution of the interest rate swap aligns with our strategy to prudently manage our interest rate risk,” Bagshaw added.

MKS is a thin film, process and industrial manufacturing, environmental monitoring, defense and security and life sciences and research technology company based in Andover, Mass.

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