Element Solutions Inc (ESI): debt financing — Element Solutions borrows $150M to terminate distribution agreement; enters cross-currency swaps

Element Solutions Inc

Borrowed $150M Tranche A Term Loans at SOFR+1.75%, maturing Jan 31, 2026.
Proceeds used to finance termination of a long-standing distribution agreement closed June 1, 2023.
Entered swap transactions converting $150M USD debt to €140.2M fixed-rate EUR debt at 4.59% all-in rate.
New maintenance covenant requires first lien net leverage ratio ≤5.00x; terms otherwise identical to existing $750M tranche B term loans.
Hedge counterparties include lenders; swaps mature January 31, 2026.

Key facts

Extracted from this filing and checked against the source text.

Debt Financings SEC 8-K Item 2.03/2.04 confidence 0.9

Element Solutions Inc incurred term loan of $150 million with Citibank, N.A. at Term SOFR (as defined in the Credit Agreement), plus a spread of 1.75% per annum maturing January 31, 2026.

Instrument: term loan
Principal: $150 million
Counterparty: Citibank, N.A.
Rate: Term SOFR (as defined in the Credit Agreement), plus a spread of 1.75% per annum
Maturity: January 31, 2026
Event: incurrence

Exact text from the filing

Pursuant to Amendment No. 7, the Borrowers borrowed new U.S. dollar-denominated term loans (the "Tranche A Term Loans") under an incremental term loan facility (the "Term Loan A Facility") in an aggregate principal amount of $150 million under the Credit Agreement.

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Debt Financings SEC 8-K Item 2.03/2.04 confidence 0.9

Element Solutions Inc entered an off-balance-sheet arrangement for debt of an aggregate initial notional amount of approximately €140.2 million with certain banks at fixed EUR all-in rate of 4.59% maturing January 31, 2026.

Principal: an aggregate initial notional amount of approximately €140.2 million
Counterparty: certain banks
Rate: fixed EUR all-in rate of 4.59%
Maturity: January 31, 2026
Event: off balance sheet

Exact text from the filing

Swap Transactions On June 1, 2023, the Company entered into swap transactions (the "Swaps") with certain banks, including lenders of the Tranche A Term Loans (the "Hedge Counterparties").

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Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.9

Element Solutions Inc amended Amendment No. 7 and Joinder to Credit Agreement with Citibank, N.A., as collateral agent and administrative agent, and the lenders party thereto valued at $150 million (effective 2023-06-01).

Action: amendment
Agreement: credit facility
Counterparty: Citibank, N.A., as collateral agent and administrative agent, and the lenders party thereto
Value: $150 million
Effective: 2023-06-01

Exact text from the filing

On June 1, 2023, Element Solutions Inc (the "Company"), MacDermid, Incorporated ("MacDermid," and together with the Company, the "Borrowers"), certain subsidiaries of the Company party thereto, Citibank, N.A., as collateral agent and administrative agent (the "Agent"), and the lenders party thereto, entered into an Amendment No. 7 and Joinder to Credit Agreement ("Amendment No. 7")

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Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.7

Element Solutions Inc entered into Swaps with certain banks, including lenders of the Tranche A Term Loans valued at aggregate initial notional amount of approximately €140.2 million (effective 2023-06-01).

Action: entry
Agreement: credit facility
Counterparty: certain banks, including lenders of the Tranche A Term Loans
Value: aggregate initial notional amount of approximately €140.2 million
Effective: 2023-06-01

Exact text from the filing

On June 1, 2023, the Company entered into swap transactions (the "Swaps") with certain banks, including lenders of the Tranche A Term Loans (the "Hedge Counterparties")

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Element Solutions Inc filing history →

Source: SEC EDGAR

accession 0001590714-23-000051

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