QualTek Services secures approval of $141.2 million DIP financing

By Sarah Lizee

Olympia, Wash., June 13 – QualTek Services Inc. received approval of $141.2 million in debtor-in-possession financing provided by existing secured lenders, according to an order filed Tuesday with the U.S. Bankruptcy Court for the Southern District of Texas.

The DIP financing consists of a $40 million new-money term loan and a $101.2 million revolver, as previously reported.

Following a previously entered interim order, the DIP term loan included a one-to-one rollup of prepetition incremental term loans, and now following the final order, the remaining outstanding amount of incremental term loans is also being rolled up.

The revolver was set with a creeping rollup through the entry of the final order, and now all remaining outstanding prepetition revolving debt will convert into DIP debt.

Interest on the revolver is the Bloomberg short-term bank yield index rate plus 500 basis points in cash, and interest on the term loan is SOFR plus 100 bps cash and 1,100 bps payment in kind.

PNC Bank, NA is administrative agent for the revolver, and UMB Bank, NA is the agent for the term loan.

The prepetition secured parties have also consented to the company’s use of cash collateral. The court gave final approval of the cash collateral access through Tuesday’s order.

QualTek is a Blue Bell, Pa.-based provider of turnkey services to the North American telecommunications, infrastructure and power industries. The company filed bankruptcy on May 24 under Chapter 11 case number 23-90584.

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