Tenneco Inc. (TEN) Thursday reported replacing its current senior credit facility, worth $834 million, with a similar facility worth $1.1 billion, in a refinancing transaction that may close later on Thursday. The move is expected to lower annual interest expense while raising the size and expanding the term of the debt.
The new facility comprises a $850 million revolving credit facility which matures March 22, 2017 and also a $250 million loan A facility with the same final maturity date, but requiring quarterly installments. The interest rate is anticipated to be LIBOR plus 2.50 percent for borrowings under either of the facilities.
Also, the loan A facility may be used to repurchase the company's 8 1/8 percent senior notes due 2015, which are worth $250 million, through a tender offer.
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