Griffon Announces Amended Credit Facility; Revolving Commitments Increased to $500 Million
02 Agosto 2023 - 7:02AM
Business Wire
Griffon Corporation (“Griffon” or the “Company”) (NYSE:GFF)
announced today that it amended its credit agreement (the “Amended
Credit Agreement”) to increase the size of its revolving credit
facility (the “Revolver Facility”) from $400 million to $500
million, and extend the maturity of the Revolver Facility from
March 22, 2025 to August 1, 2028. The Amended Credit Agreement
continues to provide for a Term Loan B facility, which matures on
January 24, 2029.
Commenting on the amendment, Ronald J. Kramer, Chairman and
Chief Executive Officer, said “The closing of our amended revolving
credit facility provides us with additional financial and operating
flexibility that will support our working capital requirements and
position us to continue to grow our Company and further enhance
shareholder value.”
Bank of America, N.A. acts as administrative agent under the
Amended Credit Agreement. The Revolver Facility provides for
revolver borrowings in an aggregate principal amount of up to $500
million and contains a $125 million letter of credit sub-facility
(increased from $100 million), and a $200 million foreign currency
sub-facility. The Amended Credit Agreement also has a customary
accordion feature that permits Griffon to request an increase in
the Revolving Facility and/or one or more additional term loan
commitments, up to an aggregate principal amount equal to the
greater of $500 million (increased from $375 million) and an amount
such that, immediately after giving effect to the incurrence of the
relevant incremental facilities, Griffon’s secured leverage ratio
does not exceed 3.50 to 1.00. Griffon may elect to pay interest
based on either Term SOFR (subject to a 0.50% floor with respect to
the Term Loan B facility and 0.00% with respect to the Revolver
Facility) or an alternate base rate, plus an applicable margin that
depends on Griffon’s leverage ratio. Initial pricing for the
Revolver Facility is Term SOFR plus 2.00% or alternate base rate
plus 1.00%. The Revolver Facility is guaranteed by Griffon’s
material domestic subsidiaries and is secured by substantially all
the assets of Griffon and the guarantors. The Revolver Facility
also contains customary financial and other affirmative covenants,
negative covenants and events of default. If the Company’s 5.75%
senior notes are not refinanced prior to December 1, 2027, the
Revolver Facility will mature on that date.
Forward-looking
Statements
“Safe Harbor” Statements under the Private Securities Litigation
Reform Act of 1995: All statements related to, among other things,
income (loss), earnings, cash flows, revenue, changes in
operations, operating improvements, the impact of the Hunter Fan
transaction, the industries in which Griffon Corporation (the
“Company” or “Griffon”) operates and the United States and global
economies that are not historical are hereby identified as
“forward-looking statements” and may be indicated by words or
phrases such as “anticipates,” “supports,” “plans,” “projects,”
“expects,” “believes,” “should,” “would,” “could,” “hope,”
“forecast,” “management is of the opinion,” “may,” “will,”
“estimates,” “intends,” “explores,” “opportunities,” the negative
of these expressions, use of the future tense and similar words or
phrases. Such forward-looking statements are subject to inherent
risks and uncertainties that could cause actual results to differ
materially from those expressed in any forward-looking statements.
These risks and uncertainties include, among others: current
economic conditions and uncertainties in the housing, credit and
capital markets; Griffon’s ability to achieve expected savings and
improved operational results from cost control, restructuring,
integration and disposal initiatives (including, in particular, the
expanded CPP outsourcing strategy announced in May 2023); the
ability to identify and successfully consummate, and integrate,
value-adding acquisition opportunities; increasing competition and
pricing pressures in the markets served by Griffon’s operating
companies; the ability of Griffon’s operating companies to expand
into new geographic and product markets, and to anticipate and meet
customer demands for new products and product enhancements and
innovations; increases in the cost or lack of availability of raw
materials such as resin, wood and steel, components or purchased
finished goods, including any potential impact on costs or
availability resulting from tariffs; changes in customer demand or
loss of a material customer at one of Griffon’s operating
companies; the potential impact of seasonal variations and
uncertain weather patterns on certain of Griffon’s businesses;
political events that could impact the worldwide economy; a
downgrade in Griffon’s credit ratings; changes in international
economic conditions including inflation, interest rate and currency
exchange fluctuations; the reliance by certain of Griffon’s
businesses on particular third party suppliers and manufacturers to
meet customer demands; the relative mix of products and services
offered by Griffon’s businesses, which impacts margins and
operating efficiencies; short-term capacity constraints or
prolonged excess capacity; unforeseen developments in
contingencies, such as litigation, regulatory and environmental
matters; Griffon’s ability to adequately protect and maintain the
validity of patent and other intellectual property rights; the
cyclical nature of the businesses of certain of Griffon’s operating
companies; possible terrorist threats and actions and their impact
on the global economy; effects of possible IT system failures, data
breaches or cyber-attacks; the impact of COVID-19, or some other
future pandemic, on the U.S. and the global economy, including
business disruptions, reductions in employment and an increase in
business and operating facility failures, specifically among our
customers and suppliers; Griffon’s ability to service and refinance
its debt; and the impact of recent and future legislative and
regulatory changes, including, without limitation, changes in tax
laws. Such statements reflect the views of the Company with respect
to future events and are subject to these and other risks, as
previously disclosed in the Company’s Securities and Exchange
Commission filings. Readers are cautioned not to place undue
reliance on these forward-looking statements. These forward-looking
statements speak only as of the date made. Griffon undertakes no
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law.
About Griffon
Corporation
Griffon Corporation is a diversified management and holding
company that conducts business through wholly-owned subsidiaries.
Griffon oversees the operations of its subsidiaries, allocates
resources among them and manages their capital structures. Griffon
provides direction and assistance to its subsidiaries in connection
with acquisition and growth opportunities as well as divestitures.
In order to further diversify, Griffon also seeks out, evaluates
and, when appropriate, will acquire additional businesses that
offer potentially attractive returns on capital.
Griffon conducts its operations through two reportable
segments:
- Home and Building Products ("HBP") conducts its operations
through Clopay. Founded in 1964, Clopay is the largest manufacturer
and marketer of garage doors and rolling steel doors in North
America. Residential and commercial sectional garage doors are sold
through professional dealers and leading home center retail chains
throughout North America under the brands Clopay, Ideal, and
Holmes. Rolling steel door and grille products designed for
commercial, industrial, institutional, and retail use are sold
under the Cornell and Cookson brands.
- Consumer and Professional Products (“CPP”) is a leading North
American manufacturer and a global provider of branded consumer and
professional tools; residential, industrial and commercial fans;
home storage and organization products; and products that enhance
indoor and outdoor lifestyles. CPP sells products globally through
a portfolio of leading brands including AMES, since 1774, Hunter,
since 1886, True Temper, and ClosetMaid.
For more information on Griffon and its operating subsidiaries,
please see the Company’s website at www.griffon.com.
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version on businesswire.com: https://www.businesswire.com/news/home/20230801737385/en/
Company Brian G. Harris SVP &
Chief Financial Officer Griffon Corporation (212) 957-5000
IR@griffon.com
Investor Relations Michael Callahan
Managing Director ICR Inc. (203) 682-8311
Griffon (NYSE:GFF)
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