Allied Motion Secures New $125 Million Credit Facility

  • Refinancing expected to reduce annual cash interest expense by approximately $3.3 million on a pre-tax basis ($2.2 million after tax) 
  • New facility provides greater financial flexibility for acquisitions  

AMHERST, N.Y., Nov. 01, 2016 (GLOBE NEWSWIRE) -- Allied Motion Technologies Inc. (NASDAQ:AMOT), a global designer and manufacturer of motion control products and solutions, announced that it has obtained a new senior secured revolving credit facility of $125 million on a 1.00% to 2.25% over LIBOR sliding-scale rate based on leverage.  The initial proceeds from the new facility were used to redeem the Company's $30 million, 14.5% senior subordinated notes due in 2019 and repay $40.5 million outstanding on its previously existing revolving credit facility and term loan.  In connection with the refinancing, the Company will recognize a $1.0 million charge for unamortized financing costs in the fourth quarter of 2016. 

Dick Warzala, Chairman and CEO of Allied Motion, said, "Our financial team has done an excellent job in securing this new credit facility, which considerably reduces our cost of debt and expands our borrowing capacity by over 50%.  Our intent is to continue thoughtfully investing in our business to support organic and acquisitive growth as we continue to expand our capabilities and increase our market share in the precision motion solutions industry." 

The new $125 million 5-year revolving credit facility is secured by substantially all of the Company's non-realty assets and is fully and unconditionally guaranteed by certain of the Company's subsidiaries.  At current debt levels, annual interest expense is reduced approximately $3.3 million on a pre-tax basis, assuming a weighted average interest rate of approximately 3.1%.  On an after-tax basis, with an effective tax rate of 31.5%, annual interest savings is $2.2 million, or $0.24 per diluted share.  The new credit facility also includes an accordion feature, allowing expansion of up to $175 million. 

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