Hexcel gets $700 million five-year revolver at Libor plus 125 bps

By Angela McDaniels

Tacoma, Wash., Sept. 29 – Hexcel Corp. entered into a new credit agreement on Friday that provides for a $700 million revolving credit facility due Sept. 23, 2019, according to an 8-K filing with the Securities and Exchange Commission.

Subsidiary Hexcel Holdings Luxembourg Sarl is co-borrower.

The initial interest rate is Libor plus 125 basis points. The margin over Libor ranges from 100 bps to 200 bps depending on the company’s consolidated leverage ratio.

Citizens Bank, NA is the administrative agent. Citizens Bank, NA, HSBC Bank USA, NA, Bank of America Merrill Lynch and Wells Fargo Securities, LLC are the joint book managers and joint lead arrangers. Bank of America, NA, HSBC Bank USA, NA and Wells Fargo Bank, NA are the syndication agents. Fifth Third Bank, SunTrust Bank, TD Bank, NA and U.S. Bank NA are the documentation agents.

The new revolver is available for working capital and other general corporate purposes. Up to $40 million of the revolver may be used for letters of credit.

The new revolver replaces the company’s previous $600 million senior secured credit facility due June 26, 2018, which was terminated.

The company said the new facility provides for a modest improvement in interest costs and greater financial flexibility.

The credit agreement contains financial covenants that require Hexcel to maintain a minimum interest coverage ratio of 3.5 times and a maximum consolidated leverage ratio of 3.5 times.

Hexcel is a composites company based in Stamford, Conn.

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