US: Dana completes refinancing
Dana Holding Corporation has completed the refinancing of its capital structure, paying down debt and replacing its secured term loan with US$750m in senior unsecured notes in a registered notes offering. Dana has also received lender commitments for a new $500 million revolving credit facility with a five-year maturity.
Standard & Poor's has upgraded Dana's credit rating to BB- reflecting an improved credit profile.
Due to the strong demand, Dana raised the initial offering of $700m and placed $750min senior notes, $400m at 6.5% due in 2019 and $350m at 6.75% due 2021.
Dana also voluntarily contributed $50m to its US pension plans in December 2010.
Over the last two years, Dana has restructured its operations, lowered its break-even point by approximately 35%, and improved operating results.
Through this refinancing, Dana significantly extends debt maturity, reduces ongoing interest cost, increases financial flexibility for growth, and diversifies the lender base. The refinancing largely eliminates secured debt from the capital structure and reduces leverage.