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Haemonetics closes $700m debt refi

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HaemoneticsHaemonetics (NYSE:HAE) said today that it closed the refinancing of some $700 million in debt as part of its restructuring plan.

Last November the Braintree, Mass.-based blood management company unveiled plans to cut roughly 11% of its global workforce as it looked to pare $80 million from its annual cash burn by the end of fiscal 2020.

Today the company said it took out a new, $700 million credit line and used it to pay of $254 million in senior unsecured term loans due next June. The credit line includes a $350 million senior unsecured term loan and a $350 million senior unsecured revolving credit line.

Haemonetics said the new loans carry an annual interest rate of London Interbank Offered Rate plus 1.25%, plus a 0.175% fee on unused cash in the credit revolver; both are subject to change based on fluctuations in the company’s debt ratio.

“Our new credit agreement enhances our strong financial profile and eases certain covenants, providing increased flexibility in a variety of areas, including expanded options for permitted debt and investments. Funds from these facilities combined with our strong cash flow enhance our ability to execute on our growth plans,” president & CEO Chris Simon said in prepared remarks.

Back in 2010 Haemonetics said it would cut about 170 workers and close facilities in Phoenix and Chicago as part of the integration of acquisition GlobalMed Technologies. In 2014, another integration – following the $550 million acquisition of Pall – prompted a 320-worker purge and the relocation of its equipment manufacturing from Braintree to a contract facility in Mexico. And in May 2016 the company said it would take a pre-tax charge of $26 million, including $17 million worth of “termination benefits,” as part of another round of layoffs aimed at boosting profitability and growth.

Last month the company eked out a sales-and-earnings beat with its fiscal fourth-quarter and 2018 numbers, posting swings to black ink for both periods.

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