MRC Global Inc. announced on October 15, 2024, an agreement to repurchase all 363,000 shares of its 6.50% Series A Convertible Perpetual Preferred Stock. This repurchase is contingent upon the successful completion of a new term loan financing. The company plans to finance this repurchase, totaling approximately $361 million plus accrued dividends, through a new senior secured term loan B and existing cash or borrowings from its asset-based lending facility.
To facilitate this, MRC Global is launching a $350 million Term Loan B financing with an expected term of seven years. The company is also pursuing an amendment to its asset-based lending facility, aiming to extend its term until 2029. These actions are expected to simplify the capital structure and eliminate potential equity dilution from the preferred shares.
In conjunction with these financial moves, MRC Global provided selected preliminary third quarter 2024 financial results. The company expects to report sales of approximately $797 million and Adjusted EBITDA of approximately $48 million for the quarter. The net debt leverage ratio post-transaction is anticipated to be less than 2 times, based on the previous twelve months of adjusted EBITDA.
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