California semi-fabricated aluminium producer Kaiser Aluminum Corporation announced on Wednesday that it has entered into a five-year, US$375-million senior secured revolving credit facility.
Per the firm, the new credit facility was negotiated in order to replace an earlier credit facility that was scheduled for maturity at the end of next year. The new facility, which went into effect on the date of announcement, increases the lending commitment by US$75 million as well as offering better pricing and increased flexibility.
Jack A. Hockema, Kaiser Aluminum’s Chairman and Chief Executive Officer, said the new facility represents the significant confidence the firm’s lenders place in the business.
“A key component of our business strategy is to maintain strong liquidity and financial flexibility that will continue to support ongoing growth and investment in our business and allow us to maintain our strong competitive position throughout the economic cycles of the end markets we serve. We are pleased that our lending banks continue to acknowledge our strong business model and prudent financial management and we appreciate their continued commitment and support.”
As of Wednesday, Kaiser Aluminum’s borrowing ability under the new line of credit and its net of outstanding letters of credit totaled US$353 million. Kaiser Aluminum’s borrowing base consists largely of accounts receivable and inventory, plus certain machines and equipment. The firm has yet to borrow under the revolving credit facility.
Based in Foothill Ranch, California, and founded in 1946, Kaiser Aluminum is one of North America’s top producers of semi-fabricated specialty aluminium products. The firm’s book of business consists of buyers from around the globe. Kaiser Aluminum’s production plants turn out value-added sheet, plate, extrusions, rod, bar, tube, and wire products, and its product offerings include aerospace and high-strength aluminium, custom automotive aluminium, general engineering aluminium, and other industrial aluminium applications.