- Diodes Incorporated (Nasdaq: DIOD) has announced it entered into a new credit agreement that will provide a three-year secured $670 million credit facility
Diodes Incorporated (Nasdaq: DIOD) has announced it entered into a new credit agreement that will provide a three-year secured $670 million credit facility. This new facility makes available up to $520 million in a term loan and a $150 million revolving credit line. And it will be funded by a syndicate of banks.
Diodes is intending to use this new credit facility to refinance existing debt, ensure access to cash at a competitive rate, and to prepare financing for the acquisition of Lite-On Semiconductor (LSC) — which is expected to close in the second half of 2020.
What does Diodes Incorporated (Nasdaq: DIOD) do? The company delivers high-quality semiconductor products to the world’s leading companies in the consumer electronics, computing, communications, industrial, and automotive markets. And it leverages an expanded product portfolio of discrete, analog, and mixed-signal products and leading-edge packaging technology to meet customers’ needs.
Diodes’ broad range of application-specific solutions and solutions-focused sales — coupled with worldwide operations of 28 sites — include engineering, testing, manufacturing, and customer service enables the company to be a provider for high-volume and high-growth markets.
“We are very pleased to enter into this new financing agreement, which represents an important step in preparing for the planned acquisition of LSC in the second half of the year,” said Diodes Incorporated (Nasdaq: DIOD) chief financial officer Brett Whitmire. “The strong support and commitment we have received from the banking group has enabled us to successfully put this new credit facility in place.”
This term loan facility includes a delayed drawdown period to contemplate the LSC acquisition closing process. And the interest rate on the facility is floating with an initial rate based on Libor plus 2% through February 2021 with a Libor floor of 0.75%.
“Bank of America was the lead in our previous facility and continued to extend their support in this new facility along with BBVA Securities and PNC Capital Markets. The ongoing dedication by these lead banks as well as the rest of the banking group during these challenging economic times is a testament to Diodes strong financial performance and cash generation as well as the partnerships we have established,” added Diodes Incorporated (Nasdaq: DIOD) Chairman, President and CEO Dr. Keh-Shew Lu.
BofA Securities, Inc., BBVA Securities and PNC Capital Markets acted as joint lead arrangers and joint bookrunners. Others that participated in the bank syndicate include Citibank, Regions Bank, Comerica Bank, Silicon Valley Bank, HSBC Bank USA, and Cadence Bank.