A.M. Castle wins approval of $85 million DIP loan, cash collateral use

By Caroline Salls

Pittsburgh, July 6 – A.M. Castle & Co. received court approval to obtain $85 million of debtor-in-possession financing from PNC Bank, NA, according to an order filed Thursday with the U.S. Bankruptcy Court for the District of Delaware.

The financing will be used to refinance up to $75 million of the company’s pre-bankruptcy first-lien obligations and to pay monthly interest on the balance of that debt.

The DIP facility will mature on the earliest of six months from the bankruptcy filing date, the effective date of a Chapter 11 plan, the closing date of a sale of all or substantially all of the company’s assets and acceleration of any of the DIP loan obligations and termination of the commitments.

Interest will be based on average daily excess availability, with the rate ranging from the Base rate plus 150 basis points to 200 bps or Libor plus 250 bps to 300 bps.

The company also received court approval to use the cash collateral of its pre-bankruptcy lenders to fund its operations while in bankruptcy.

A.M. Castle is an Oak Brook, Ill.-based distributor of specialty metal and plastic products, value-added services and supply-chain services. The company filed bankruptcy on June 18 under Chapter 11 case number 17-11330.

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