WESTPORT, Conn. (BRAIN) — Compass Diversified Holdings, the owner of CamelBak and other brands, has signed an agreement for a revolving credit facility totaling $400 million and a term loan of $325 million. The two credit facilities combine for $725 million in new debt financing and replace Compass' previous revolving credit facility and term loan facility.
Under the terms of the seven-year term loan facility, amounts borrowed bear interest at LIBOR plus a margin of 3.25 percent. The term loan facility requires quarterly payments of approximately $800,000, with a final payment of the outstanding principal balance due in June 2021. The company used approximately $280 million of the proceeds to refinance existing term loan indebtedness under its previous credit agreement.
Compass said it would use the remaining proceeds to fund expansion opportunities at its existing subsidiary companies, pursue new acquisition opportunities and provide for working capital and general corporate uses.
"We are very pleased to have completed this debt financing, which provides multiple benefits for our company," said Compass CEO Alan Offenberg. "First, it allows us to refinance our existing debt and extend our maturities to June 2019, in the case of our revolver, and to June 2021 for the new term loan. Second, it ensures attractive debt terms and pricing over the next several years. Third, the financing expands our overall debt capacity and further enhances our ability to continue to aggressively pursue organic and acquisition-related growth opportunities. Finally, we diversified our banking relationships by adding Bank of America Merrill Lynch to our lending group. We appreciate the support of all the financial institutions who participated in this transaction, which demonstrates their confidence in CODI's future prospects."
Besides CamelBak, Compass owns Advanced Circuits, American Furniture Manufacturing, Anodyne Medical Device, Arnold Magnetic Technologies, Ergobaby and Liberty Safe. Last year it spun off the Fox Factory suspension brand in an IPO.