Winnebago gets $290 million commitment letter for Newmar acquisition

Chicago, Sept. 16 – Winnebago Industries Inc. entered into an agreement for a $290 million bridge facility for its upcoming acquisition of Newmar Corp., according to an 8-K filing with the Securities and Exchange Commission.

Goldman Sachs Bank USA has agreed to commit 65% of the facility and Bank of Montreal and BMO Capital Markets Corp. have jointly committed to 35% of the facility.

Winnebago intends to issue $290 million of senior secured notes. If unable to issue the notes, or the full amount, the bridge facility will be used for the transaction.

The bridge loan will accrue interest at an initial rate of Libor plus 650 basis points until either the first anniversary of the closing date or the conversion date.

The rate will increase by 50 bps 90 days after closing and an additional 50 bps for each additional 90 days thereafter subject to a bridge cap.

The exchange notes will have a five-year maturity.

Then notes will be non-callable for the first two years and will be subject to a 35% equity clawback and make-whole provisions.

After the non-call period ends, the notes will be callable at par plus interest plus a premium equal to 75% of the coupon. The premium will decline annually to zero two years prior to maturity.

The total purchase price is $344 million, consisting of $270 million in cash and 2 million shares of Winnebago common stock.

The transaction is expected to close by Jan. 31, 2020.

Winnebago is a Forest City, Iowa-based manufacturer of recreational vehicles.

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