LENEXA, KAN. — Hostess Brands, Inc. has completed a refinancing of its first lien credit agreement and revolving line of credit, a move the company said will provide “significant financial flexibility” to drive strong shareholder returns.
The original first lien credit agreement included a $983 million loan term due August 2025 and $100 million revolving line of credit due August 2024. Hostess said its new first lien credit agreement contains a $985 million term loan that will mature in June 2030 and a revolving line of credit of $200 million that will mature in June 2028.
Proceeds from the new term loan were used to repay all outstanding principal under Hostess’ existing term loan and fund a portion of the related costs, the company said.
“We are extremely pleased with the results of our refinancing,” said Travis Leonard, chief financial officer of Hostess. “We believe that strong demand for the new term loan resulted in an attractive interest rate of SOFR plus 2.50% and an issue price of 99.25, representing one of the tightest priced syndicated loans recently issued for our ratings category. The ability to extend our debt maturity from 2025 to 2030 with minimal impact to our future interest while gaining additional liquidity through the new revolver highlights our strong operating performance and the strength of our credit profile. We believe that the successful refinancing coupled with our highly cash generative and differentiated business model continues to give us significant financial flexibility to execute on our strategic objectives and drive strong shareholder returns.”
