AZZ Inc. has successfully completed the refinancing of its $980 million term loan B due in 2029. The repricing of the loan reduces the interest rate margin by 50 basis points to SOFR + 325 basis points, resulting in annual interest savings of approximately $5 million. This marks the second repricing of the term loan B, with a total interest rate margin savings of 100 basis points since its issuance in May 2022.
Philip Schlom, the Chief Financial Officer, emphasized that the company achieved the reduction in borrowing rate without any change to its leverage, covenants, or maturity date. Since the acquisition of Precoat Metals in May 2022, AZZ Inc. has not only reduced the principal but also the interest rate on the term loan B.
The company's disciplined approach to lowering its net debt to EBITDA leverage ratio to 3.0 times or lower in calendar year 2024 is evident through these strategic refinancing efforts. This move demonstrates a commitment to optimizing the company's financial position.
As a result of these announcements, the company's shares have moved 1.1% on the market, and are now trading at a price of $80.03. If you want to know more, read the company's complete 8-K report here.
