Applied Materials gets five-year $1.5 billion revolver

By Wendy Van Sickle

Columbus, Ohio, Feb. 21 – Applied Materials, Inc. entered into a credit agreement Friday providing for a five-year $1.5 billion revolver with JPMorgan Chase Bank, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The revolver replaces a $1.5 billion credit agreement dated Sept. 3, 2015.

There is a $400 million sublimit for letters of credit.

An accordion feature permits Applied Materials to increase the commitment to up to a total of $2 billion.

Borrowings bear interest at Libor plus a margin that is based on the company’s public debt credit ratings and ranges from 62.5 basis points to 112.5 bps. There is a commitment fee on unused borrowings that ranges from 5 bps to 12.5 bps.

JPMorgan, Citibank, NA, MUFG Bank, Ltd., U.S. Bank NA, Wells Fargo Securities, LLC, BofA Securities, Inc. and Mizuho Bank, Ltd. are the joint lead arrangers and joint bookrunners.

Citigroup Global Markets Inc., MUFG, U.S. Bank, Wells Fargo Bank, NA, Bank of America, NA and Mizuho are the syndication agents.

BNP Paribas and Goldman Sachs Bank USA are the documentation agents.

Borrowings may be used for general corporate purposes.

The credit agreement matures on Feb. 21, 2025.

The company must comply with a maximum ratio of consolidated funded debt to consolidated adjusted EBITDA of 3.5 times, which may be increased to 4 times following some acquisitions.

Applied Materials is a Santa Clara, Calif., manufacturer of semiconductor equipment.

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