Narrative
Full Description
Project narrative
On January 30, 2015, financial close was reached on a deal in which a syndicate of 29 banks — including Bank of China — entered into a $1.75 billion USD syndicated loan agreement with Regal-Beloit Corporation — a Wisconsin-based manufacturer of electric motors, electrical motion controls, power generation, and power transmission products — to support the company’s working capital and general corporate needs, as well as to refinance debt and finance the PTS Acquisition. This loan was divided into two tranches: a $500 million USD revolving credit facility and a $1.25 billion USD term loan facility. The maturity of the loan is 5 years; the interest rate is LIBOR plus an applicable margin. The proceeds were used by the borrower to support general working capital and corporate operations through the revolving credit facility, while the term loan facility was allocated toward refinancing existing debt and financing the acquisition of Power Transmission Solutions (PTS), a business unit of Emerson Electric Co. While Bank of China contributed $35 million USD to this loan (Record ID#109164), the following lenders also participated: JPMorgan Chase Bank ($120 million USD), U.S. Bank ($120 million USD), Wells Fargo Bank ($120 million USD), Bank of America ($120 million USD), Compass Bank ($84.99 million USD), Fifth Third Bank ($84.99 million USD), HSBC Bank USA ($84.99 million USD), Mizuho Bank ($84.99 million USD), PNC Bank ($84.99 million USD), Sumitomo Mitsui Banking Corporation ($84.99 million USD), SunTrust Bank ($84.99 million USD), MUFG Bank ($84.99 million USD), BMO Harris Bank ($64.99 million USD), Regions Bank ($64.99 million USD), Santander Bank ($50 million USD), TD Bank ($50 million USD), Metlife Reinsurance Company of South Carolina ($37 million USD), Metropolitan Life Insurance Company ($13 million USD), Branch Banking and Trust Company ($40 million USD), Citizens Bank ($40 million USD), The Northern Trust Company ($40 million USD), Bank of East Asia ($30 million USD), Bank of the West ($27.5 million USD), Mega International Commercial Bank ($20 million USD), Bank of Taiwan ($15 million USD), First Tennessee Bank ($15 million USD), Taiwan Business Bank ($15 million USD), Taiwan Cooperative Bank ($15 million USD), and First Hawaiian Bank ($12.5 million USD). On August 25, 2018, financial close was reached on a deal in which a syndicate of 19 banks — including Bank of China — entered into a $1.4 billion USD syndicated loan agreement with Regal-Beloit Corporation — a Wisconsin-based manufacturer of electric motors, electrical motion controls, power generation, and power transmission products — to replace an earlier 2015 financing arrangement. This loan was divided into three tranches: a $900 million USD term loan facility, a $225 million USD Revolving Facility A, and a $275 million USD Revolving Facility B. The maturity of the loan is 5 years; the interest rate is LIBOR plus an applicable margin. The proceeds were used by the borrower as follows: term loan proceeds were used to pay fees, costs, and expenses associated with the refinancing transaction and for general corporate purposes; proceeds from the revolving facilities were designated for capital expenditures. While Bank of China contributed $30 million USD to this loan (Record ID#109165), the following lenders also participated: JPMorgan Chase Bank ($124.99 million USD), U.S. Bank ($114.99 million USD), Wells Fargo Bank ($114.99 million USD), Bank of America ($114.99 million USD), PNC Bank ($114.99 million USD), BMO Harris Bank ($70 million USD), Compass Bank ($70 million USD), Fifth Third Bank ($70 million USD), HSBC Bank USA ($70 million USD), Mizuho Bank ($70 million USD), MUFG Bank ($70 million USD), Regions Bank ($70 million USD), Sumitomo Mitsui Banking Corporation ($70 million USD), SunTrust Bank ($70 million USD), Branch Banking and Trust Company ($55 million USD), TD Bank ($55 million USD), Bank of the West ($30 million USD), and First Hawaiian Bank ($15 million USD).
Staff comments
1. The entirety of the 2015 loan contract can be accessed at https://www.sec.gov/Archives/edgar/data/82811/000008281115000045/exhibit101creditagreement.htm. The dropbox link is accessible here: https://www.dropbox.com/scl/fi/2zjgji8lxlb47vr8600x1/Source_ID_221860.pdf?rlkey=fgq4shc9uvplyus277dx04lrd&st=doqw7lpa&dl=0 2. Regal Rexnord Corporation (formerly Regal-Beloit) is an American manufacturer headquartered in Beloit, Wisconsin. It specializes in electric motors and motion control systems for industrial, commercial, and consumer markets, and expanded its portfolio with the acquisition of the PTS business. Power Transmission Solutions, Inc. (PTS) is a technology company providing Products and Services to electric transmission industry. 3. AidData estimates the interest rate by adding the 6-month average LIBOR rate in January 2015 and an applicable margin based on Funded Debt to EBITDA Ratio (1.375%) 4. The 2018 amended loan is accessible here: https://www.sec.gov/Archives/edgar/data/82811/000008281118000112/rbc101.htm. The dropbox link is accessible here: https://www.dropbox.com/scl/fi/9d80i6muerjq5jvvupxyl/Source_ID_221861.pdf?rlkey=6tl9555dtax6efcbqd0yydxtr&st=b62jx5f4&dl=0