Houston-based EGL, Inc. increased its 364-day $50 million credit to $150 million and extended its tenor to three years during its renegotiation of the facility this month. Elijio Serrano, cfo, explained that the company closed on the new Bank of America led credit three weeks ago after launching it in late October. "We just didn't want to go through the process every three years," said Serrano, explaining why the company decided to lengthen the tenor on the facility. Serrano said increasing the tenor on the facility did not present a pricing issue as the pricing did not change dramatically. "It increased slightly but not significantly," he said. Serrano said pricing on the new credit is LIBOR plus 87 1/2 % versus LIBOR plus 62 1/2 % on the 364-day. The company paid 250 basis points in commitment fees, he added.
Serrano said the company re-signed with Bank of America--its historical lead--because of its long-standing relationship with the bank and its breadth of coverage. Co-agents on the transaction included SouthTrust Bank and The Bank of Tokyo-Mitsubishi. Serrano said the need for working capital was the main driver behind increasing the facility to $150 million. In addition, Serrano said the company may use the facility to finance future acquisitions. "We would only look at making acquisitions that are roughly $20 million each", he said. EGL is a transportation, supply chain management company.