A.M. Castle Secures Credit Facilities
By Metal Center News Staff
on Jun 7, 2017
A.M. Castle, Oak Brook, Ill., has executed an agreement with PNC Bank on a $125 million revolving credit facility, and a separate $85 million revolving debtor-in-possession credit facility. The facilities are part of the company’s prepackaged financial restructuring. The closing of the new ABL and DIP facilities are subject to closing conditions and bankruptcy court approval.
“We believe that reaching these agreements with PNC, an established lender to the metals industry, will be extremely advantageous to Castle as we complete our financial restructuring, allowing us to emerge a financially stronger company. PNC’s commitment to providing working capital at competitive rates will significantly reduce our cost of capital resulting in substantial cash interest savings of at least 70 percent from our current annualized rate of approximately $36 million which will help us deliver on our promise of growing our partnerships with our vendors and improving our service to our customers,” says Executive Vice President and CFO Patrick Anderson.
The company has solicited votes on its proposed Prepackaged Joint Chapter 11 Plan of Reorganization and expects to announce the results of the solicitation soon. The plan provides Castle will continue to operate business as usual, including paying all vendors in a timely manner, delivering product to its customers without any change in quality or on-time performance, and continuing to compensate its employees competitively and timely, the company claims.