Xylem to use credit facilities, up to $1.3 billion notes to buy Sensus

By Angela McDaniels

Tacoma, Wash., Aug. 15 – Xylem Inc. expects to finance its all-cash acquisition of Sensus USA Inc. with new and existing credit facilities, a combination of short- and long-term debt, including up to $1.3 billion of senior notes, and about $400 million of non-U.S. cash, according to a company news release.

On Monday, Xylem entered into a commitment letter with Citigroup Global Markets Inc., Wells Fargo Securities, LLC and Wells Fargo Bank, NA for a $1.3 billion 364-day bridge loan.

Xylem agreed to pay about $1.7 billion of cash and expects the acquisition to be completed during the fourth quarter. The acquisition is not subject to a financing condition.

The company expects the acquisition to increase its leverage to the 3.6 times area from 2.6 times and its leverage to return to between 2.5 times and 3.0 times within 12 to 18 months.

Xylem is a Rye Brook, N.Y., provider of water technology. Raleigh, N.C.-based Sensus makes smart meters and is owned by investment funds affiliated with Jordan Co. and GS Capital Partners 2000.

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