Avanos Medical signs for new $500 million credit agreement

Chicago, June 30 – Avanos Medical, Inc. entered into a $500 million credit agreement on June 24 with JPMorgan Chase Bank, NA as the administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The facility breaks down into a $125 million five-year senior secured term loan and a $375 million five-year senior secured revolver.

The letter of credit sub-facility is for $75 million.

There is a $125 million accordion feature plus any voluntary repayments on either the revolver or term loan and an unlimited amount as long as the company’s consolidated net secured leverage ratio, after giving pro forma effect to the incurrence of any such incremental loans or commitments, is not more than 3.5x.

The credit agreement matures on June 24, 2027, but may be extended subject to consent of extending lenders.

Both parts have interest at adjusted term SOFR plus 150 basis points to 200 bps, based on the company’s consolidated total leverage ratio.

The unused portion of the revolver will have a commitment fee between 20 bps and 25 bps, also based on leverage.

Either the term loan or the revolver can be prepaid without penalty.

MUFG Bank, Ltd., PNC Bank, NA and U.S. Bank NA are co-syndication agents.

JPMorgan, MUFG, PNC and U.S. Bank are joint lead arrangers and joint bookrunners.

Avanos Medical is a medical device company based in Alpharetta, Ga.

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