Kemet secures €60 million credit facility, gets commitment for €35 million more

By Angela McDaniels

Tacoma, Wash., Sept. 29 - Kemet Corp. said it received a new €60 million medium-term credit facility A and a commitment for a €35 million credit facility B from UniCredit Corporate Banking SpA.

Both facilities priced at Euribor plus 170 basis points.

The company will repay facility A in nine equal, semiannual installments over the four-and-a-half-year term of the loan with the first payment due in April 2009.

The facility will be secured with land and real estate in Italy, some accounts receivable in Europe and a pledge of the shares of Arcotronics Italia SpA and Arcotronics Industries Srl, two of Kemet's subsidiaries in Italy.

Facility B will be a factoring arrangement with repayment at maturity in December 2013.

The two facilities replace the €95 million six-year unsecured credit facility with UniCredit that Kemet announced on July 30, according to a company news release.

Closing on facility A is expected to occur in about two weeks. Closing on facility B is expected to occur as soon as factoring mechanisms are put in place and, in any case, no later than April 2009.

Proceeds will be used to refinance two short-term credit facilities with UniCredit totaling €96.8 million and currently scheduled to mature in December and April 2009.

"While we remain focused on the execution of our plans to return to profitability, we will continue to explore alternatives that will improve our long-term liquidity and reduce our overall debt structure," chief executive officer Per Loof said in the release.

Kemet is a Greenville, S.C.-based provider of capacitor technologies across tantalum, ceramic, film, aluminum, electrolytic, and paper dielectrics.

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