Keane closed a five-year, $200 million senior unsecured revolver, that will potentially be used to fund acquisitions, said Mate Converse, v.p., corporate finance. The company may also use the funds for share repurchases and/or geographic expansion into new target markets. "We anticipated we would have significant M&A opportunities," she said. "We have done a handful of good smaller deals [the past few years], but we still have a lot of funding that we got from the [convertible offering in June 2003]. So this is just added flexibility on top of that. We are seeing improved viability in mandate opportunities and seeing growth for us." She could not discuss any potential acquisitions the company may be considering but said, "We always have our eyes on things."
The Boston-based business and information technology company has the option to increase the facility by up to $50 million. The company had previously had a $50 million revolver in place and this was a "significant upsizing of that." Converse said the increased funds provide the company with financing flexibility if it does chose to grow the business.
She said pricing has not been disclosed, but added that based on what the company has seen in the market, "we do feel good on the pricing." Converse explained that based on the level of leverage, as more is drawn down, rates will go up. "We feel that they are pretty competitive; we're pretty pleased," she said.
Bank of America leads the deal. KeyBank, Wachovia Bank, Sovereign Bank, Citigroup, HSBC Bank, Wells Fargo and Morgan Stanley are all included in the syndicate. The company's relationship dates back to Commercial Bank, then Fleet Bank and now B of A. B of A has also participated in the company's convertible offering and provides a lot of cash management services to the company.