Chart Industries Announces Favorable Repricing of Term Loan Facility
Chart Industries (NYSE: GTLS), a leader in clean energy and industrial gas solutions, announced the successful repricing of its $1,631 million senior secured term loan facility. The new terms lower the interest rate by 0.75% per annum, resulting in an anticipated annual interest expense saving of $14 million. The repricing will be implemented through an amendment to Chart's fifth amended and restated credit agreement, expected to close in July 2024, subject to customary conditions.
- Successful repricing of $1,631 million term loan.
- Interest rate reduction by 0.75% per annum.
- Anticipated annual cost savings of $14 million.
- Repricing to be implemented via an amendment expected to close in July 2024.
- Implementation subject to customary closing conditions.
- Execution of definitive documentation still pending.
Insights
Chart Industries has managed to reprice its $1.631 billion term loan facility, cutting down the interest by 0.75% per year. This change translates to a significant cost saving of
Moreover, the term loan's new structure involves a 0.50% floor on SOFR (Secured Overnight Financing Rate) plus a margin of 2.50%. Previously, it included a 0.10% credit spread adjustment, which has now been removed. This adjustment aligns well with current interest rate trends, where the SOFR is commonly used as a benchmark.
Such savings are particularly valuable in the context of ongoing investments in clean energy and industrial gas solutions, allowing the company to allocate more resources to growth and innovation. This repricing demonstrates the company's strategic financial management aimed at optimizing debt servicing cost, which is important in the competitive clean energy market. However, investors should keep an eye on how these savings are utilized—whether they bolster the cash reserves, reduce existing debt further or are reinvested into growth opportunities.
From a market perspective, this move by Chart Industries reflects a broader industry trend of companies leveraging lower interest rates to optimize their financial structures. The clean energy sector, in particular, is capital-intensive, often requiring substantial upfront investments. Thus, reducing annual interest expenses by
The anticipated cost savings also signal Chart's proactive approach in managing its financial health, which could improve investor confidence. Moreover, the repricing aligns with efforts to enhance operational efficiency and maintain competitiveness amid rising focus on sustainable solutions. Investors should note that while the immediate impact is positive, the long-term effects will depend on how effectively these savings are deployed.
The adjustment positions Chart Industries advantageously, given the growing global emphasis on clean energy initiatives. Nonetheless, market followers should monitor subsequent financial reports to gauge the actual benefits realized from this financial maneuver.
ATLANTA, June 13, 2024 (GLOBE NEWSWIRE) -- Chart Industries, Inc. (NYSE: GTLS) (“Chart”), a global leader in clean energy and industrial gas solutions, has successfully syndicated the repricing of its
The repricing described above is expected to be implemented via an amendment to Chart’s fifth amended and restated credit agreement, which is expected to close in July 2024, subject to customary closing conditions and the execution of definitive documentation.
About Chart Industries
Chart Industries, Inc. is an independent global leader in the design, engineering, and manufacturing of process technologies and equipment for gas and liquid molecule handling for the Nexus of Clean™ - clean power, clean water, clean food, and clean industrials, regardless of molecule. The company’s unique product and solution portfolio across stationary and rotating equipment is used in every phase of the liquid gas supply chain, including engineering, service and repair and from installation to preventive maintenance and digital monitoring. Chart is a leading provider of technology, equipment and services related to liquefied natural gas, hydrogen, biogas, and CO2 capture amongst other applications. Chart is committed to excellence in environmental, social, and corporate governance (ESG) issues both for its company as well as its customers. With 64 global manufacturing locations and over 50 service centers from the United States to Asia, Australia, India, Europe, and South America, the company maintains accountability and transparency to its team members, suppliers, customers, and communities. To learn more, visit www.chartindustries.com.
Investor Contact:
John Walsh
VP, Investor Relations
770-721-8899
john.walsh@chartindustries.com
FAQ
What recent financial action has Chart Industries (GTLS) taken?
How much will Chart Industries save annually from the term loan repricing?
When is the repricing of Chart Industries' term loan expected to be implemented?
