The Gorman-Rupp Company completed a series of debt refinancing transactions on May 31, 2024. These transactions were designed to reduce the company's interest expense and extend the maturities of its borrowings. This strategic financial move is expected to provide a more stable capital structure for future operations.
As part of the refinancing, Gorman-Rupp upsized its existing Senior Term Loan Facility from $350.0 million to $370.0 million and amended and extended its $100.0 million revolving Credit Facility. Additionally, the company issued $30.0 million in new 6.40% Senior Secured Notes. These actions demonstrate a proactive approach to managing its debt portfolio.
The proceeds from these transactions, combined with $10.0 million of cash on hand, were utilized to retire the company’s $90.0 million unsecured Subordinated Credit Facility. This retirement of higher-cost debt is a key factor in the anticipated reduction of future interest expenses, directly benefiting the company's bottom line.
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