Hostess Brands announces completion of strategic refinancing
Hostess Brands announced the completion of a debt refinancing, including the repricing of its existing First Lien Term Loan and the refinancing of its existing debt into an all first lien capital structure. Under the refinancing, the company's First Lien Term Loan was repriced from LIBOR plus 3.50% to LIBOR plus 3.00%, resulting in an interest rate reduction of 50 basis points, while the remaining $83M of the company's Second Lien Term Loan with an interest rate of LIBOR plus 7.50% was refinanced with an incremental $83M First Lien Term Loan at LIBOR plus 3.00%. The company expects to realize approximately $8M of interest expense savings annually, or approximately 4c of basic earnings per share to common shareholders, as a result of the refinanced capital structure. No covenants were changed and the First Lien Term Loan continues to have a maturity date of August 3, 2022.