Lear refinances existing facility with $2 billion revolving, term loans

By Marisa Wong

Morgantown, W.Va., Aug. 8 – Lear Corp. entered into a credit agreement on Tuesday for a $1.75 billion revolving credit facility and a $250 million term loan, according to an 8-K filing with the Securities and Exchange Commission.

JPMorgan Chase Bank, NA, HSBC Securities (USA), Inc., Barclays Bank plc, Citigroup Global Markets Inc. and Merrill Lynch, Pierce, Fenner & Smith Inc. are the joint lead arrangers and bookrunners with JPMorgan as administrative agent, HSBC Securities as syndication agent and Barclays Bank, Citibank NA and Merrill Lynch as co-documentation agents.

The company repaid in full and terminated its existing revolver and term loan using proceeds from the new facility.

The new facility matures on Aug. 8, 2022.

The credit agreement includes an incremental facility that provides for up to $500 million of incremental term or revolving loans.

Revolving loans bear interest at Libor plus a margin ranging from 100 basis points to 160 bps, depending on ratings.

In addition, a facility fee is payable on the revolver at 12.5 bps to 30 bps, also based on ratings.

Term loans bear interest at Libor plus 112.5 bps to 190 bps, depending on ratings.

As of the closing date, Lear was in compliance with all covenants under its credit agreement. The company said the covenants were revised giving it more operating flexibility than the previous credit facility.

Lear is a Southfield, Mich.-based supplier of automotive seating and electrical systems.

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