K&F gets better rate on credit facility after August IPO

By E. Janene Geiss

Philadelphia, Oct. 18 - K&F Industries Holdings, Inc. announced Tuesday that it has reached an agreement with its lenders to amend its existing credit facility to provide more favorable borrowing costs.

The amended credit facility immediately reduces the interest rate across the entire pricing grid of K&F's term loans by 25 basis points, resulting in an annual reduction in interest expense of about $1 million based on the company's $456 million of term loans currently outstanding, company officials said in a news release.

With the change, effective pricing is reduced to Libor plus 225 basis points from Libor plus 250 basis points.

The amended facility also allows K&F to further reduce its annual borrowing costs based on a lower consolidated leverage ratio.

"We expect that, based on our pricing grid, K&F will qualify for the next interest rate step down within the next 12 months, saving an additional $1 million of cash interest expense per year," Kenneth M. Schwartz, president and chief executive officer, said in the release.

The amended credit facility reflects K&F's enhanced capitalization following its initial public offering in August, K&F said.

K&F Industries Holdings, through its Aircraft Braking Systems Corp. subsidiary, manufactures wheels, brakes and brake-control systems for commercial transport, general aviation and military aircraft. Its other subsidiary, Engineered Fabrics Corp., manufactures aircraft fuel tanks, de-icing equipment and specialty fabrics for commercial and military use.

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