Metal Management gets new $200 million credit facility

By Sara Rosenberg

New York, June 29 - Metal Management Inc. closed on a new $200 million revolving and letter-of-credit facility due June 28, 2008. LaSalle Bank was the lead bank on the deal.

The interest rate on the facility is dependant on the company's leverage ratio, which as currently measured results in an effective borrowing rate of about 2.8% per annum, a company news release said.

Borrowings are available to help fund the company's working capital requirements and for general corporate purposes.

Proceeds from the facility are being used to repay the amounts outstanding under the company's current $110 million revolver and an $18 million term loan and to provide working capital.

"We appreciate the enthusiasm of our newly formed bank group as demonstrated in this credit commitment. The new facility is very important to the future growth of the company as it provides financial flexibility, a foundation of long term debt, a lower effective borrowing rate and substantial excess availability," said Daniel W. Dienst, chairman and chief executive officer, in the release.

"We anticipate that annual interest expense (including amortization of financing costs) would be lower under the new credit agreement by approximately $1.8 million assuming borrowing levels and prevailing rates at March 31, 2004."

Metal Management is a Chicago full-service metals recycler.

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