Schnitzer Steel amends to push up U.S. dollar loans to $800 million

Chicago, Aug. 23 – Schnitzer Steel Industries, Inc. amended for the third time its third amended and restated credit agreement on Monday, according to an 8-K filing with the Securities and Exchange Commission.

The revolving credit agreement lists Schnitzer Steel Canada Ltd. as a Canadian borrower and Bank of America, NA as administrative agent.

U.S. dollar loans have been increased to $800 million from $700 million. The maturity date has also been extended to August 2027.

Commitments for Canadian dollar loans remain at C$15 million.

On Friday, the company had around $290 million in borrowings outstanding under the existing credit agreement.

The company also improved pricing terms in the amendment.

Borrowings will now bear interest at SOFR (or CDOR) plus 125 basis points to 200 bps. Pricing will be tied to the company’s consolidated net funded debt to EBITDA ratio.

The commitment fee will be between 17.5 bps and 30 bps, also based on the debt to EBITDA ratio.

The amended facility allows for the possibility of improvement in the rate based on key performance indicators being met in relation to the company’s environmental, social and governance targets. The company would need to consult with a sustainability coordinator to implement the changes, but a grid with better pricing was established.

Bank of Montreal is listed as Canadian lender.

JPMorgan Chase Bank, NA is the syndication agent.

Keybank NA, PNC Bank, NA, Umpqua Bank, Wells Fargo Bank, NA, U.S. Bank NA and MUFG Bank, Ltd. are the co-documentation agents.

Bank of America, NA and JPMorgan Chase Bank, NA are the joint lead arrangers and joint bookrunners.

Proceeds may be used for working capital and other general corporate purposes, including permitted acquisitions, capital expenditures and refinancing debt.

Schnitzer Steel is a Portland, Ore.-based recycler of scrap metal, provider of used and recycled auto parts and a manufacturer of finished steel products.

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