SON, THE NETHERLANDS – Neways Electronics has reached an agreement with a pair of banks on a new credit facility that increases its access to loans and replaces its current terms.
The new credit facility of €57.5 million in total replaces the three-year facility with ING and ABN AMRO set to expire mid-2017.
The new group facility expires Oct. 31, 2018, with a one-year extension option. The facility consists of a long-term loan of €5 million and a current account facility that has been expanded by €17.5 million to €52.5 million. The EMS firm must repay the long-term loan before Oct. 1, 2017.
With the new agreement, equity is to reach at least €50 million ($54.5 million) in 2016 and €55 million in 2017 and 2018. Additionally, EBITDA over the past 12 months should be at least €10 million. The old agreement included conditions for a minimum solvability of 35% and a maximum net debt/EBITDA of 3.0. Pledging requirements practically remain unchanged.
In a statement, CFO Paul de Koning said, “This new and broader group facility with more favourable conditions provides sufficient strength and flexibility in the covenants to pursue our growth strategy and operational improvement programme going forward. Additionally, this new agreement assures Neways a financing structure that fits the characteristics of our Company and on balance results in lower interest expenses.”
1 EUR = 1.08971 USD