Regal Rexnord gets $5.5 billion bridge loan commitment for Altra buy

By Sara Rosenberg

New York, Nov. 1 – Regal Rexnord Corp. has received a commitment for a roughly $5.5 billion 364-day senior bridge loan to help fund its acquisition of Altra Industrial Motion Corp., according to an 8-K recently filed with the Securities and Exchange Commission.

The company also has a commitment for a roughly $2.03 billion backstop credit facility, split between a $1 billion backstop revolver and a roughly $1.03 billion backstop term loan, in case it does not obtain certain required consents from the lenders under its existing credit agreement.

JPMorgan Chase Bank provided the debt commitment.

Under the agreement, Altra Industrial is being bought for $62.00 per share, or about $4.95 billion.

Net leverage is anticipated to be around 3.9x at closing. The company expects strong pro forma free cash flow to enable rapid delevering, with net debt/adjusted EBITDA expected to be 2.5x to 3x in 2024, and decline to a target of 2x to 2.5x thereafter.

Closing is expected in the first half of 2023, subject to the receipt of regulatory approvals, Altra shareholder approval and the satisfaction of other customary conditions.

Regal Rexnord is a Beloit, Wis.-based manufacturer of industrial powertrain solutions, power transmission components, electric motors and electronic controls, air moving products, and specialty electrical components and systems. Altra Industrial is a Braintree, Mass.-based designer and manufacturer of highly engineered motion control, automation and power transmission solutions.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.