Narrative
Full Description
Project narrative
On November 30, 2017, financial close was reached on a deal in which a syndicate of 13 banks—including the New York Branch of the Industrial and Commercial Bank of China (ICBC) and the Los Angeles Branch of the Bank of China (BOC)—entered into a $750 million USD syndicated revolving loan agreement with KLA-Tencor Corporation, a Delaware-based company specializing in semiconductor process control and yield management systems. The maturity of the loan was five years, with a maturity date of November 30, 2022, and the interest rate was based on the Adjusted LIBOR Rate plus an applicable margin based on credit ratings. There was also a commitment fee for unused portions based on credit ratings. The agreement featured an incremental increase option. The loan was intended to be used for general corporate purposes and refinance existing indebtedness under existing credit agreement from November 14, 2014. ICBC (Record ID#105194) contributed $49 million and BOC (Record ID#105195) contributed $35 million USD, other banks also participated: JPMorgan Chase Bank, N.A., Bank of America, Citibank, N.A., The Bank of Tokyo-Mitsubishi UFJ, Ltd., Wells Fargo Bank, National Association, DBS Bank Ltd., The Bank of Nova Scotia, Branch Banking & Trust Company, The Northern Trust Company, SunTrust Bank, and U.S. Bank National Association. On November 2, 2018, the borrower and lenders agreed to increase the amount by $250 million USD and pushed the maturity date by a year (November 30, 2023). The interest terms remain unchanged. BOC contributed $16 million in this increase (Record ID#105196) and ICBC contributed $12 million USD (Project $105197). In the second, third, and fourth quarters of fiscal 2020, the borrower made principal payments of $25.0 million USD, $200.0 million USD, and $175.0 million USD, respectively. During the first quarter of the fiscal year ending June 30, 2021, the borrower made a principal payment of $50.0 million USD on the Revolving Credit Facility. During the first quarter of the fiscal year ending June 30, 2022, the borrower drew down $300.0 million USD from the Revolving Credit Facility, which was paid in full in the same quarter. On June 8, 2022, the company entered into a financial deal in which a syndicate of 12 banks —including the New York Branch of ICBC and the Los Angeles Branch of the Bank of China (BOC)—provided $1.5 billion USD revolving credit agreement. The loan replaced the previous credit agreement and carried a maturity date on June 8, 2027 (5 years). Subject to the terms of the Credit Agreement, the Revolving Credit Facility could be increased by an amount up to $250.0 million USD in the aggregate. The interest rate was SOFR plus 0.1% adjustment rate plus an applicable margin determined by the credit ratings. The loan also had two one-year extension options. In addition to ICBC (Record ID#105198) and BOC (Record ID#105199), other banks also participated: JPMorgan Chase Bank, N.A., Bank of America, Citibank, N.A., Wells Fargo Bank, National Association, DBS Bank Ltd., The Bank of Nova Scotia, Truist Bank, The Northern Trust Company, BNP Paribas, and U.S. Bank National Association. During the quarter ended September 30, 2022, the borrower drew down $300.0 million USD from the agreement. As of June 30, 2024, the borrower had no outstanding borrowings under the Revolving Credit Facility.
Staff comments
1. KLA Corporation is a California-based capital equipment incorporated in Delaware that supplies process control and yield management systems for the semiconductor industry and other related nanoelectronics industries. Prior to January 2019, the company was formerly known as KLA-Tencor. 2. AidData estimates the interest rate by adding the SOFR rate on June 8 2022, 0.1% adjustment rate, and the applicable rate based on ratings. Based on the company’s credit ratings in June 2022, 1% interest was added to the SOFR rate. (1%+0.1%+0.76%=1.86%). 3. The Commitment fee was determined by the credit ratings. As of November 2018, the commitment fee is 0.1% per year. 4. The individual contributions of the 12 lenders to this $1.5 billion USD syndicated loan are unknown. For the time being, AidData has estimated the contribution of BOC and ICBC by assuming that each lender contributed an equal amount ($125,000,000.00 USD) to the loan syndicate.