Sportsman’s Warehouse improves pricing on term loans, ups revolver

By Toni Weeks

San Luis Obispo, Calif., Dec. 4 – Sportsman’s Warehouse Holdings, Inc. said it has completed the refinancing of its existing $235 million senior secured term loans with KKR, according to a press release.

The new six-year $160 million senior term loan facility, which priced at 99, carries an interest rate of Libor plus 600 basis points with a 1.25% Libor floor. The rate is a reduction of more than 1% over the blended rate on the two tranches of the prior term loans, the release said.

The new loan lowers scheduled amortization payments to about $1.6 million per year, a reduction of about $800,000 from the prior term loans.

The company said in the release that it will save about $2 million annually in interest expenses, or roughly $0.03 per share, after tax, under the new term loan.

In connection with the refinancing, the company expects to record a pre-tax charge of about $5.7 million for the write-off of deferred financing fees and other fees, of which $5.4 million is non-cash, in the fourth quarter of fiscal year 2014, according to the release.

The new term loan has substantially the same financial negative and affirmative covenants and events of default as the prior facility.

The company said it has also increased the borrowing capacity on its revolving credit facility to $135 million from $105 million with Wells Fargo Capital Finance.

The new revolving agreement, which matures in December 2019, contains a $15 million accordion feature that may be exercised after June 2017. The facility contains the same general terms as the previous agreement, the release noted.

The outdoor sporting goods retailer is based in Midvale, Utah.

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