Compass Diversified Secures $300M Credit Agreement Amendment

By Bobby Samwell • Saturday, January 11 10:16 • Permanent Link

Compass Diversified Holdings (NYSE: CODI) recently announced an amendment to its existing credit agreement with Bank of America, N.A., as administrative agent for the lenders party thereto. The amendment provides for an additional advance of the term loan in the aggregate amount of $200 million and delayed draw term loan commitments in the aggregate amount of $100 million.

The proceeds from the incremental term loan and the incremental delayed draw term loan will be used for new acquisitions, working capital, capital expenditures, and other general corporate purposes.

Under the amendment, the incremental term loan, along with the existing term loan under the credit agreement, will require quarterly repayments of the principal amount ranging from $3.75 million to $11.25 million, commencing March 31, 2025, with a final payment of principal and interest due on July 12, 2027.

Additionally, the company will be required to make quarterly repayments of the principal amount ranging from 0.625% to 1.875% of the drawn incremental delayed draw term loan, commencing on the first quarter ending after the earlier of the date the incremental delayed draw term loan is fully drawn and the end of the availability period.

Since its IPO in 2006, CODI has consistently executed its strategy of owning and managing a diverse set of highly defensible, middle-market businesses across the industrial, branded consumer, and healthcare sectors. The company leverages its permanent capital base and long-term disciplined approach to maintain controlling ownership interests in each of its subsidiaries.

CODI provides both debt and equity capital for its subsidiaries, contributing to their financial and operating flexibility. The company utilizes the cash flows generated by its subsidiaries to invest in the long-term growth of the company and has consistently generated strong returns through its culture of transparency, alignment, and accountability. Following these announcements, the company's shares moved -4.4%, and are now trading at a price of $20.93. For the full picture, make sure to review Compass Diversified's 8-K report.

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