MSA Safety enters restated $900 million five-year revolving facility

By Marisa Wong

Los Angeles, May 24 – MSA Safety Inc., MSA UK Holdings Ltd., MSA Great Britain Holdings Ltd. and MSA International Holdings BV entered into a fourth amended and restated credit agreement on Monday with PNC Bank, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The credit agreement amends and restates MSA’s third amended and restated credit agreement dated Sept. 7, 2018.

Under the newly restated credit agreement, funds may be borrowed on an unsecured revolving credit basis in a maximum outstanding amount of up to $900 million, all of which can be borrowed by MSA and of which up to the greater of $400 million or 15% of consolidated total assets can be borrowed by MSA UK, MSA GB and MSA BV.

The credit agreement also includes a $75 million sublimit for letters of credit issued on behalf of MSA and a $90 million sublimit for swingline loans to MSA.

The credit agreement also allows MSA to request increases in the aggregate commitments up to an additional $400 million.

The restated facility has a term expiring on May 24, 2026.

Borrowings bear interest at Libor plus an adder based on MSA’s net leverage ratio ranging from 87.5 basis points to 175 bps.

The adders used in the interest rate calculation and the commitment fee can be further adjusted if MSA achieves specified diversity and safety targets. The adjustment would be a decrease or increase of 2.5 bps in the case of the interest rate margin and 5 bps in the case of the commitment fee.

The credit agreement requires MSA to comply with some financial covenants, including a requirement to maintain a minimum fixed charges coverage ratio of not less than 1.50 to 1.00 and a net leverage ratio not to exceed 3.50 to 1.00 (or not to exceed 4.00 to 1.00 during the three calendar quarters including, and following, some specified acquisitions), in each case calculated on the basis of the trailing four fiscal quarters.

Based in Cranberry Township, Pa., MSA makes safety products.

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