Brunswick Corp. has increased its revolver by $300 million to $650 million due to substantial growth in the past few years and the changed lending landscape. When the company took out its $350 million revolver in 2002 revenue was $4 billion; in 2004 revenue was $6 billion. Also, "From a market perspective, when we did the deal back in 2002, it was very corporate unfriendly, a very tight market," said Bill Metzger, v.p. and treasurer. "There is a lot more capacity in the marketplace today than there was three years ago."
The Lake Forest, Ill.-based company manufactures marine engines and pleasure boats. It also markets the fitness brands Life Fitness and Hammer Strength, and makes bowling supplies and operates bowling centers. Over the last three to four years, it has invested about $725 million in acquisitions and recently acquired Triton Boat Co.
Much of this growth has taken place outside the U.S. "The company has grown significantly in its international base which accounts for 35% of its top line," said Pete Leemputtee, senior v.p. and cfo. "Given the fact that we expect to continue that trend, we wanted to have a European co-lead." It chose Royal Bank of Scotland to complement JPMorgan. Brunswick has used JPMorgan dating back to at least 1997 and Metzger said, "They are obviously a market leader and we have always had a very good experience with them."Bank One had served as Brunswick's co-lead on the previous facility.
The new credit consists of a five-year, $650 million revolver with pricing based on a grid driven by Standard & Poor's and Moody's Investors Service long-term ratings. Undrawn pricing is LIBOR plus 10 basis points and when first drawn it is an all inclusive price of LIBOR plus 45 basis points.
Looking ahead Leemputtee said the company sees the potential for doing a few more deals and increasing its focus on investing abroad and ensuring greater growth. "We are the largest producer of marine engines and recreational boats in the world with 65% of revenues in the U.S. and 35% abroad," he said. "We have been focused on filling white spaces in product offerings, making sure we can offer a full line of boating products to distributors."