Horizon Global Corporation has closed on a new financing agreement to provide additional liquidity and an amendment of its existing term debt agreement to relax financial covenants, including the following:
$51 million new second lien term loan, providing for incremental liquidity and payment of fees
Amendment to existing first lien term loan to align financial covenants with the company’s business plans and waive financial covenants for the fourth quarter 2018
Horizon Global intends to use a substantial portion of the proceeds from the incremental borrowings to better position the company to meet its customers’ needs for its 2019 summer selling season and provide additional operating flexibility.
Carl Bizon, Horizon Global president and CEO, said, “Horizon Global has made significant progress driving operational improvements throughout the business to set a foundation for improved performance in 2019. During the last year, the company executed the Americas Action Plan to improve performance in this important segment, including realigning the management, operational and sales teams to enhance performance and reduce the cost structure, as well as positioning our new aftermarket and retail distribution center in Kansas City to support our customers during the 2019 peak selling season. This additional financing will help support our focus on providing the best possible service to our North American customers, while also supporting our execution against a number of business improvement initiatives in the Europe-Africa segment, including streamlining logistics, realigning management and optimizing the performance of our manufacturing facilities in the region. The combined efforts of our global team are expected to generate improvements in revenue, margins and cash flow during the year.”
The company previously secured a short-term bridge term loan facility of $10 million, which was repaid from a portion of the proceeds of the new second lien term loan.