Flowserve Secures $1.45 Billion Amended & Restated Credit Facility, Extends Maturity to 2031
Summary
Flowserve secured a new $1.45 billion amended and restated credit agreement, comprising a $1.0 billion revolving facility and a $450 million term loan, extending maturity to 2031 and immediately drawing $700 million for refinancing and general corporate purposes.
Key Events
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New Credit Facilities Secured
Flowserve entered into a Third Amended and Restated Credit Agreement for $1.45 billion, consisting of a $1.0 billion unsecured revolving credit facility and a $450.0 million unsecured term loan facility.
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Refinancing and General Corporate Purposes
On the closing date, $450.0 million was drawn under the term loan and $250.0 million under the revolving credit facility to refinance existing debt and for general corporate purposes.
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Extended Maturity Date
The new credit facilities have a maturity date of April 15, 2031, providing long-term financial stability.
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Financial Covenants Established
The agreement includes financial covenants, such as a maximum consolidated net leverage ratio (initially 4.00 to 1.0, then 3.75 to 1.0, with a temporary increase option to 4.25 to 1.0 after material acquisitions) and a minimum consolidated interest coverage ratio of 3.25 to 1.0.
Analysis
Flowserve Corporation has entered into a Third Amended and Restated Credit Agreement, securing new credit facilities totaling $1.45 billion. This includes a $1.0 billion unsecured revolving credit facility and a $450.0 million unsecured term loan facility, both maturing on April 15, 2031. The company immediately drew $450.0 million from the term loan and $250.0 million from the revolving credit facility, primarily for refinancing existing debt and general corporate purposes. This significant financing package extends the company's debt maturity profile and provides substantial liquidity and financial flexibility, reinforcing its capital structure. The agreement includes customary financial covenants, such as consolidated net leverage ratios and interest coverage ratios, which the company must maintain.
At the time of this filing, FLS was trading at $78.82 on NYSE in the Technology sector, with a market capitalization of approximately $10B. The 52-week trading range was $39.85 to $92.41. This filing was assessed with positive market sentiment and an importance score of 8 out of 10.