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Simpson Manufacturing gets $600 million loan commitment to buy Etanco
By Marisa Wong
Los Angeles, Jan. 31 – Simpson Manufacturing Co., Inc. executed a commitment letter on Dec. 22 with Wells Fargo Bank, NA, Wells Fargo Securities, LLC and MUFG Union Bank, NA that provides a commitment for $600 million in the form of a term loan and additional revolver commitments, according to an 8-K filed Monday with the Securities and Exchange Commission.
Funding of the new debt is contingent on the satisfaction of customary conditions, including execution and delivery of definitive documentation with respect to the new debt and consummation of Simpson’s acquisition of Etanco Group.
Simpson, via its wholly owned subsidiary Simpson Strong-Tie Europe, entered into a securities purchase agreement on Jan. 26 with Fastco Investment, Fastco Financing, LRLUX and some other security holders relating to the acquisition.
The securities purchase agreement provides for a purchase price of €725 million, subject to closing adjustments. The purchase price is expected to be financed with a combination of the new debt, borrowings under the company’s existing credit facility and cash on the company’s balance sheet.
According to a separate lender presentation, the company expects to use $100 million of existing cash on its balance sheet; its existing revolver will be increased to $450 million from $300 million; and the term loan portion of the Wells Fargo and MUFG commitment is for $450 million.
Closing of the acquisition is expected to occur by April 1.
Simpson is a Pleasanton, Calif.-based engineering firm and building materials producer. Entaco is a European manufacturer and distributor of fasteners for building construction.
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