Bank of America, First Union, andToronto-Dominion Bank have taken agent roles on FleetBoston Financial's $200 million refinancing for Buckeye Technologies. FirstStar, ABN Amro, Wachovia Bank andFirst Pioneer have also put up commitments. Gayle Powelson, cfo, declined to comment more specifically on the amounts committed. Powelson explained that the new facility will replace a $225 million credit the company previously had with Fleet. "It's not an overall debt reduction because we have increased our basket for foreign loans," said Powelson, explaining that the company has opted to reduce it's overall bank debt in the U.S. and increase it abroad as the company becomes increasingly active on the foreign acquisition front. "It's more efficient to do loans abroad because of foreign currency issues," she said.
Powelson said the company works with ABN Amro on its foreign deals. In addition, Powelson noted that the company's existing loan had one-year left on its maturity, but included a step-down feature that would reduce the loan to $150 million this May. "We need a larger amount than $150 million for our U.S. operation," she said, explaining why the company wanted to get a new $200 million credit in place.
The new deal comprises a $200 million revolving credit facility priced at LIBOR plus 13/8 %--the same pricing on the existing deal. Powelson said she was pleased that pricing stayed the same considering the company faced a more difficult market than it did in 1997. She attributed pricing to the company's consistent earnings stream. The deal is scheduled to close this week. Buckeye Technologies makes absorbency, chemical cellulose, and customized paper products.