Koppers Announces Closing of $400 Million Term Loan B; Redeems 6.00% Senior Unsecured Notes due 2025

Rhea-AI Summary

Koppers Holdings Inc. (NYSE: KOP) announced the successful closing of a $400 million senior secured Term Loan B (TLB) with a 7-year term. The loan, which carries an interest rate at the company's option of adjusted Term SOFR plus 4.00%, will be used primarily to redeem $500 million of 6.00% Senior Unsecured Notes due in 2025. CFO Jimmi Sue Smith emphasized that this refinancing enhances the company's balance sheet flexibility and risk management by extending the maturity of its debt profile. The company plans to implement hedging strategies to balance its interest rate exposure. Wells Fargo is the administrative agent for the TLB, with several banks acting as joint lead arrangers.

Positive

• Successfully closed $400 million Term Loan B.
• Refinancing enhances balance sheet flexibility.
• Redemption of $500 million Senior Unsecured Notes reduces debt obligations.
• Strategic extension of debt maturity dates.

Negative

• None.

PITTSBURGH, April 11, 2023 /PRNewswire/ -- Koppers Holdings Inc. (NYSE: KOP), an integrated global provider of treated wood products, wood treatment chemicals, and carbon compounds, today announced the closing of a 7-year $400 million senior secured Term Loan B (TLB), which will bear interest, at the company's option, at adjusted Term SOFR or adjusted Daily Simple SOFR, in each case plus 4.00% with a floor of 50bps.

Proceeds from the TLB, along with cash on hand and borrowing under its revolving credit facility, were used to redeem the company's outstanding $500 million 6.00% Senior Unsecured Notes that were due in 2025 and to pay fees and expenses incurred in connection with the TLB and the redemption of the Notes.

Commenting on the transaction, Chief Financial Officer Jimmi Sue Smith said, "The success of this refinancing reflects the ongoing focus on enhancing our balance sheet flexibility, which is one of the company's core strategic pillars. Consistent with our capital structure priorities, we are reducing risk and gaining flexibility by extending the maturity date for our debt profile. While the TLB has a floating rate, we intend to enter into hedging instruments over the next several months to achieve a balanced mix of fixed and floating rates and to help protect against interest rate exposure."

Wells Fargo Bank, National Association is acting as administrative agent for the TLB. Wells Fargo Securities LLC, PNC Capital Markets LLC, BofA Securities, Inc., Fifth Third Bank, National Association, Citizens Bank, N.A. and Truist Securities, Inc. are acting as joint lead arrangers and bookrunners for the TLB.

About Koppers

Koppers, with corporate headquarters in Pittsburgh, Pennsylvania, is an integrated global provider of treated wood products, wood treatment chemicals, and carbon compounds. Our products and services are used in a variety of niche applications in a diverse range of end markets, including the railroad, specialty chemical, utility, residential lumber, agriculture, aluminum, steel, rubber, and construction industries. We serve our customers through a comprehensive global manufacturing and distribution network, with facilities located in North America, South America, Australasia, and Europe. The stock of Koppers Holdings Inc. is publicly traded on the New York Stock Exchange under the symbol "KOP."

For more information, visit: koppers.com. Inquiries from the media should be directed to Ms. Jessica Franklin Black at BlackJF@koppers.com or 412-227-2025. Inquiries from the investment community should be directed to Ms. Quynh McGuire at McGuireQT@koppers.com or 412-227-2049.

Safe Harbor Statement

Certain statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and may include, but are not limited to, statements about sales levels, acquisitions, restructuring, declines in the value of Koppers assets and the effect of any resulting impairment charges, profitability and anticipated expenses and cash outflows.

All forward-looking statements involve risks and uncertainties. All statements contained herein that are not clearly historical in nature are forward-looking, and words such as "outlook," "guidance," "forecast," "believe," "anticipate," "expect," "estimate," "may," "will," "should," "continue," "plan," "potential," "intend," "likely," or other similar words or phrases are generally intended to identify forward-looking statements. Any forward-looking statement contained herein, in other press releases, written statements or other documents filed with the Securities and Exchange Commission, or in Koppers communications and discussions with investors and analysts in the normal course of business through meetings, phone calls and conference calls, regarding future dividends, expectations with respect to sales, earnings, cash flows, operating efficiencies, restructurings, the benefits of acquisitions, divestitures, joint ventures or other matters as well as financings and debt reduction, are subject to known and unknown risks, uncertainties and contingencies.

Many of these risks, uncertainties and contingencies are beyond our control, and may cause actual results, performance or achievements to differ materially from anticipated results, performance or achievements. Factors that might affect such forward-looking statements include, among other things, the impact of changes in commodity prices, such as oil and copper, on product margins; general economic and business conditions; disruption in the U.S. and global financial markets; potential difficulties in protecting our intellectual property; the ratings on our debt and our ability to repay or refinance our outstanding indebtedness as it matures; our ability to operate within the limitations of our debt covenants; potential impairment of our goodwill and/or long-lived assets; demand for Koppers goods and services; competitive conditions; interest rate and foreign currency rate fluctuations; availability and costs of key raw materials; unfavorable resolution of claims against us, as well as those discussed more fully elsewhere in this release and in documents filed with the Securities and Exchange Commission by Koppers, particularly our latest annual report on Form 10-K and any subsequent filings by Koppers with the Securities and Exchange Commission. Any forward-looking statements in this release speak only as of the date of this release, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after that date or to reflect the occurrence of unanticipated events.

For Information:	Quynh McGuire, Vice President, Investor Relations
	412 227 2049
	McGuireQT@koppers.com

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SOURCE Koppers

FAQ

What is the purpose of Koppers' $400 million Term Loan B?

The $400 million Term Loan B will be used primarily to redeem $500 million of 6.00% Senior Unsecured Notes due in 2025.

What does Koppers plan to do with the interest rate of the Term Loan B?

Koppers intends to enter into hedging instruments to achieve a balanced mix of fixed and floating interest rates to protect against interest rate exposure.

Who is the administrative agent for Koppers' Term Loan B?

Wells Fargo Bank, National Association is acting as the administrative agent for the Term Loan B.

How does Koppers' refinancing affect its debt profile?

The refinancing extends the maturity date for Koppers' debt profile, thereby reducing risk and enhancing financial flexibility.