Knight-Swift enters $1.2 billion two-tranche unsecured credit facility

By Wendy Van Sickle

Columbus, Ohio, Oct. 3 – Knight-Swift Transportation Holdings Inc. entered into a $1.2 billion unsecured credit facility on Friday, according to an 8-K filed with the Securities and Exchange Commission.

The new credit agreement provides for a five-year $800 million revolving credit facility and a three-year $400 million term loan, which has no scheduled amortization prior to its maturity.

The credit facility replaces Swift Transportation Co.’s previous secured credit facility that provided for a $600 million revolving credit facility due June 2020 and a $680 million term loan A and Knight Transportation Inc.’s previous unsecured $300 million revolving credit facility due Aug. 1, 2019. Knight’s availability under the credit agreement had dropped to $50 million after the two companies merged on Sept. 8.

Both tranches of the new credit facility initially bear interest at Libor plus a margin of 112.5 basis points, with the margin subject to a leverage-based pricing grid.

The refinancing reduced the company’s interest rate by 37.5 bps at closing.

Wells Fargo Bank, NA is the administrative agent, and Bank of America, NA and PNC Bank NA are the co-syndication agents.

Financial covenants include a maximum consolidated net leverage ratio and a minimum consolidated interest coverage ratio.

At closing, $80 million was drawn on the revolver.

Phoenix-based Knight-Swift is the result of the combination of Knight, a Phoenix-based trucking company, and Swift, a Phoenix-based transportation services company.

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