HOUSTON, March 28, 2013 /PRNewswire/ -- Kraton Performance Polymers, Inc. (NYSE: KRA), (the "Company") a leading global producer of styrenic block copolymers, announced today that it has closed an aggregate $250 million of revolving credit facilities. The facilities are comprised of a $150 million five-year, secured U.S. revolving credit facility and a $100 million five-year, secured non-U.S. revolving credit facility. Availability under the facilities will be subject to a borrowing base and the facilities will be secured by receivables and inventory. The facilities include a $100 million uncommitted accordion feature that, subject to borrowing base availability and approval of the bank syndicate, could increase aggregate availability to $350 million.
The new revolving credit facilities replace the company's $200 million revolving credit facility and bank term loan. An initial draw of $40 million under the new U.S. revolving facility was used, in conjunction with cash on hand, to repay the $82 million balance outstanding under the company's bank term loan.
"The favorable credit market conditions provided us with an opportunity to refinance our existing bank facility. We believe this new facility will provide greater financial flexibility while also lowering our cost of capital," said Stephen E. Tremblay, Kraton's Vice President and Chief Financial Officer.
Bank of America, N.A. served as Administrative Agent, Collateral Agent and Security Trustee. Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan Securities, LLC and Wells Fargo Capital Finance, LLC were Joint Lead Arrangers and Joint Book Managers. J.P. Morgan Chase Bank, N.A. and Wells Fargo Bank, National Association served as Co-Syndication Agents and Barclays Bank PLC served as Document Agent. The syndication also included Siemens Financial Services, Inc. and HSBC Bank USA, N.A.
In conjunction with the refinancing, the company expects its first quarter 2013 results to reflect a non-cash charge of approximately $5 million resulting from accelerated amortization of debt issuance costs and a charge of approximately $0.7 million due to the termination of an interest rate swap, both of which will be reflected in interest expense for the period.
Kraton Performance Polymers, Inc., through its operating subsidiary Kraton Polymers LLC and its subsidiaries (collectively, "Kraton"), is a leading global producer of engineered polymers and one of the world's largest producers of styrenic block copolymers (SBCs), a family of products whose chemistry was pioneered by Kraton almost 50 years ago. Kraton's polymers are used in a wide range of applications, including adhesives, coatings, consumer and personal care products, sealants and lubricants, and medical, packaging, automotive, paving, roofing and footwear products. The company offers products to more than 800 customers in over 60 countries worldwide. We manufacture products at five plants globally, including our flagship plant in Belpre, Ohio, which we believe is the most diversified SBC plant in the world, as well as plants in Germany, France, Brazil and Japan. The plant in Japan is operated by an unconsolidated manufacturing joint venture. For more information on the company, please visit www.kraton.com.
Kraton, the Kraton logo and design, and the "Giving Innovators their Edge" tagline are all trademarks of Kraton Polymers LLC.
For Further Information: Investors: H. Gene Shiels 281-504-4886
SOURCE Kraton Performance Polymers, Inc.