Oglebay to launch $230 million credit facility during June 26 week

By Sara Rosenberg

New York, June 23 - Oglebay Norton Co. is planning to launch its proposed $230 million credit facility into syndication during the week of June 26, according to a company news release.

JPMorgan is the lead bank on the deal.

The facility consists of a $55 million five-year asset-based revolver talked at Libor plus 125 basis points with an undrawn fee of 37.5 basis points, a $140 million six-year term loan talked at Libor plus 275 basis points, and a $35 million delayed-draw term loan with undrawn pricing of 137.5 basis points and drawn pricing talked at Libor plus 275 basis points, the release said.

Proceeds will be used to refinance the company's existing credit facility, to provide for the conversion of the company's convertible preferred stock and to provide for capital expansion.

The delayed-draw term loan, which will be available for draw for nine months, will serve as a backstop for opportunistic calls on the convertible preferred stock or, alternatively, for certain capital expenditures.

Financial covenants include maximum leverage, minimum fixed charge coverage and maximum capital expenditures. And, there will be a fixed asset coverage test of greater than 2.0 times at closing.

"The recently announced sale of our marine vessels has enabled us to pay down debt to approximately $160 million on a pro-forma basis. With the lower debt, the company is well positioned to refinance its existing credit facilities with more attractive pricing and terms," said Michael Lundin, president and chief executive officer, in the release.

"This refinancing will provide added flexibility as we execute on our stated strategy of focusing on our limestone, limestone fillers and industrial sands businesses. The financing should improve profitability by enabling us to invest in productivity-enhancing projects and pursue new market and customer opportunities, especially in the flue gas desulphurization and energy markets," Lundin added in the release.

Oglebay Norton is a Cleveland-based provider of essential minerals and aggregates to a broad range of markets, from building materials and environmental remediation to the energy and metallurgical industries.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.