Celestica adds $365 million term loan, ups revolver to $600 million

By Wendy Van Sickle

Columbus, Ohio, Dec. 6 – Celestica Inc. said it enhanced its current credit facility by expanding its borrowing capacity with improved terms, according to a news release.

Celestica now has $660.4 million of term loans outstanding, compared to $440.4 million outstanding at Sept. 30. The net increase reflects the repayment of amounts borrowed under the company’s revolver, which were used to finance a portion of the purchase of PCI Private Ltd.

The key amendments to the credit facility include the provision of a new $365 million second incremental term loan, all of which was immediately drawn; an increase in the commitments under the revolver to $600 million from $450 million and an extension of the revolver’s maturity date; and the amendment of certain other provisions, including an increase to certain exception “basket” amounts under specified restrictive covenants.

The net proceeds from the second incremental term loan were used to repay all remaining amounts outstanding under the company’s November 2018 term loan which had $145 million outstanding, as well as to repay $215 million of the $220 million borrowed under the revolver.

The second incremental term loan and the revolver each mature in March of 2025, unless either: the company’s June 2018 term loan has been prepaid or refinanced or commitments under the revolver are available and have been reserved to repay the initial term loan in full, in which case the obligations mature in December of 2026.

The second incremental term loan currently bears interest at Libor plus 200 basis points, and is subject to quarterly principal repayments of $4,562,500. The amended credit facility includes Libor successor provisions.

The initial term loan, which has $295.4 million outstanding, was unchanged by the amendment, and amounts currently outstanding thereunder mature in June 2025.

Bank of America, NA is administrative agent. BofA Securities, Inc. (left lead), Canadian Imperial Bank of Commerce and Bank of Nova Scotia acted as lead arrangers and bookrunners.

Celestica is a Toronto-based provider of design, manufacturing and supply chain solutions.

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