Castle Secures DIP Facility
By
Metal Center News Staff on
Jul 19, 2017
A.M. Castle & Co., Oak Brook, Ill., has closed a $85 debtor in possession financing agreement as part of its bankruptcy proceedings. The DIP facility, which was initially announced on June 5, will allow the company to immediately reduce cash interest payments by replacing a substantial portion of its current first lien credit facilities, which carry 11.0 percent interest. Castle also expects to use additional available capital from its cash on hand and the DIP facility to invest in growth initiatives as it approaches the completion of its prepackaged financial restructuring later this summer.
"As the company moves forward with its prepackaged proceeding, the DIP facility provides us with working capital at competitive rates, which will enable us to realize immediate, substantial cash interest savings,” President and CEO Steve Scheinkman says. “As we previously announced, Castle has also executed a commitment letter with PNC Bank for a $125 million senior-secured, revolving credit facility, anticipated to close later this summer once we complete our financial restructuring and otherwise satisfy the conditions to closing.”
Scheinkman says the capital will allow Castle to support uninterrupted operations and growth investments. It should “permit us to concentrate on growing our business, improving our service to customers and strengthening our partnerships with vendors.”