Ribbon Communications finalized a $385 million senior secured credit facility. This new financial arrangement, known as the 2024 Credit Facility, includes a $350 million term loan and a $35 million revolving credit line. The funds will be utilized to refinance an existing credit facility, fully redeem Ribbon's outstanding Series A Preferred Stock, and cover associated fees and expenses. Any remaining proceeds will support the company's working capital and other general corporate needs, facilitating further network modernization and protection for its global clientele.
The loans under the 2024 Credit Facility are set to mature on June 21, 2029. Initially, the interest rate will be SOFR plus 6.25%, which will adjust to a range between SOFR plus 5.75% to 6.25% depending on Ribbon's consolidated net leverage after the fiscal year ending December 31, 2024. Alternatively, Ribbon has the option to choose an interest rate based on an alternative base rate with a margin from 4.75% to 5.25%. The credit facility is secured by nearly all of Ribbon's and certain subsidiaries' assets. HPS Investment Partners, LLC will act as the Administrative Agent, with HPS and WhiteHorse Capital serving as joint lead arrangers and bookrunners.
Key Points:
- Ribbon Communications finalizes a $385 million senior secured credit facility.
- The facility includes a $350 million term loan and a $35 million revolving credit line.
- Proceeds will refinance existing debt, redeem Series A Preferred Stock, and support general corporate purposes.
- Loans mature on June 21, 2029, with interest rates tied to SOFR plus a margin based on net leverage.
- HPS Investment Partners, LLC and WhiteHorse Capital lead the arrangement and administration of the facility.
