By Lisa Kerner
Charlotte, N.C., Feb. 26 - ShawCor Ltd. announced it will issue $350 million of senior notes with terms ranging from seven to 15 years in a private placement.
The weighted average term of the notes is 10.4 years, and the weighted average annual yield is about 3.65%.
Proceeds will help fund the C$580 million of cash needed to complete the proposed elimination of the company's dual-class share structure.
Under the note placement, ShawCor's maximum leverage ratio cannot exceed 3.0 to 1.0, and it must maintain a minimum interest coverage ratio of at least 2.5 to 1.0.
Shareholders will vote on the dual-class structure elimination at a special meeting on March 14. Additional funding is expected to come from a $100 million increase to the company's revolving credit facility as well as from cash on hand, a ShawCor news release said.
"The financing available to us under the senior notes private placement and the amended revolving credit facilities should not result in excessive leverage and is expected to support our growth agenda following the completion of the arrangement," president and chief executive officer Bill Buckley said in the release.
ShawCor is a Toronto-based energy services company.
| Issuer: | ShawCor Ltd.
|
| Issue: | Senior notes
|
| Amount: | $350 million
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| Weighted average term: | 10.4 years
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| Weighted average yield: | 3.65%
|
| Distribution: | Private placement
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