- Newport Refinances Credit Facility
IRVINE, Calif., July 19, 2013 — Laser maker Newport Corp. announced Friday that it has entered into a new $275 million senior secured revolving credit facility, with a $50 million expansion option, through a syndicate of global financial institutions led by JPMorgan Chase Bank.
The new loan agreement replaces the company's existing $250 million senior secured credit facility, has a term of five years, and initially bears an interest rate of 2 percent over LIBOR (London Interbank Offered Rate), or 1 percent over a base rate, at the company's option, with a commitment fee of 0.35 percent on the undrawn amount of the facility, Newport said. The photonics maker can use the funds for working capital, acquisitions, stock repurchases and other general business costs.
After closing the new agreement, Newport said it repaid its existing loan in full by borrowing $120 million under the new facility and repaying the remainder from its cash balance, which reduced its outstanding senior secured debt by approximately $32.6 million.
Newport said it expects the new loan's lower interest rates and fees, combined with the lower loan balance, to reduce its financing costs by approximately $500,000 per quarter beginning in the third quarter of fiscal 2013. During that quarter, the company will record a noncash charge of $3.4 million to write off the remaining unamortized balance of the previously capitalized fees of the prior loan.
Charles F. Cargile, Newport’s senior vice president, chief financial officer and treasurer, said the new loan gives the company “significantly greater flexibility from a borrowing capacity, cash flow and covenant perspective, with lower ongoing financing costs. We are confident that it will provide us with the liquidity we need to execute our strategic plan and fuel our future growth.”
For more information, visit: www.newport.com
- The technology of generating and harnessing light and other forms of radiant energy whose quantum unit is the photon. The science includes light emission, transmission, deflection, amplification and detection by optical components and instruments, lasers and other light sources, fiber optics, electro-optical instrumentation, related hardware and electronics, and sophisticated systems. The range of applications of photonics extends from energy generation to detection to communications and...
MORE FROM PHOTONICS MEDIA