Primo Water gets $220 million term loan, revolver at 250 bps

By Susanna Moon

Chicago, June 25 – Primo Water Corp. said it has obtained a $220 million senior secured credit facility due June 2023 consisting of a $190 million term loan and a $30 million revolving credit facility.

Interest on the loans is initially Libor plus 250 basis points, which may be lowered based on the company’s consolidated leverage ratio.

SunTrust Robinson Humphrey is the lead arranger with BMO Harris Bank, NA, U.S. Bank, NA and JPM Securities, LLC as joint lead arrangers.

Proceeds of the facility along with funds from a follow-on equity offering are being used to repay the company’s $186 million senior credit facility and its 9 1/16% junior subordinated deferrable interest debentures.

Primo expects interest expense to be about $5 million under the new facility for the six months ending Dec. 31, 2018, which represents a savings of about $5.5 million for the second half of 2018 compared with the previous facilities, according to a company announcement.

The interest savings have been slated for working capital purposes, including marketing initiatives designed to accelerate growth, the release noted.

The company said on June 4 that subsidiary Primo Water Operations, Inc. called its 9.0625% junior subordinated deferrable interest debentures due 2028 for redemption.

Primo is a Winston-Salem, N.C., provider of multi-gallon purified bottled water, self-serve filtered drinking water and water dispensers.

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