Armor to get new credit facility for Stewart & Stevenson purchase

By Sara Rosenberg

New York, Feb. 27 - Armor Holdings Inc. plans to obtain a new senior credit facility to help fund its acquisition of Stewart & Stevenson Services Inc., a company spokesman told Prospect News on Monday.

Wachovia is the lead bank on the deal, the spokesman added.

According to one buy-side source, the credit facility will be an all pro-rata deal with price talk possibly coming out in the Libor plus 125 basis point range.

Under the purchase agreement, Armor will acquire all of Stewart & Stevenson's outstanding stock for $35.00 per share in cash. The total value of the transaction is expected to be about $755 million after deducting Stewart & Stevenson's net cash balance of $312 million as of Jan. 31.

Closing is anticipated to occur within the next three to four months, subject to Stewart & Stevenson shareholder approval, the expiration or termination of the Hart-Scott-Rodino waiting period and other customary conditions.

Armor is a Jacksonville, Fla.-based manufacturer and distributor of security products and vehicle armor systems serving military, law enforcement, homeland security and commercial markets. Stewart & Stevenson is a Houston-based manufacturer of military tactical wheeled vehicles.

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