S&P rates R.J. Tower DIP loan BBB

Standard & Poor's made public the confidential BBB rating it assigned on Feb. 18 to the $725 million debtor-in-possession loan of R.J. Tower Corp., a subsidiary of Tower Automotive Inc. (NR/--/--).

The loan has a two-year maturity and is extended by JPMorgan Chase Bank NA and other banks.

S&P said the rating reflects S&P's view that Tower has relatively good prospects for reorganizing, given its importance to customers as a leading supplier of structural component and assemblies to the auto industry. Success of the reorganization will depend on retaining important customers and realizing the benefits from comprehensive rationalization and cost-reduction actions.

The $725 million DIP facility consists of a $300 million revolving credit facility ($100 million letter of credit sub-limit), and a $425 million term loan. Tower received final court approval on Feb. 28 for the DIP loan, and proceeds from the $425 million term loan were used to repay in full obligations outstanding under its existing $425 million senior secured first-lien bank credit facility.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.