Taylor Wimpey announces refinancing of credit facility ahead of schedule
UK housebuilding company Taylor Wimpey has announced it has completed the refinancing of its revolving credit facitility, due to mature in November next year, with a new revolving credit facility for £550m, which will mature in August 2018.
Revolving credit facilities are a type of credit issued without a predetermined number of payments, usually used to provide liquidity for day-to-day operations.
Group finance director Ryan Mangold said he was “pleased” to have completed this refinancing ahead of schedule.
The new debt facility will provide ample headroom to deliver our strategic objectives whilst reducing our finance costs. This provides us with a solid base to further optimise our capital structure later this year with the repayment of the Senior Notes, creating a more efficient debt structure by the end of the year and positioning the Group well for the future….
As indicated at our half year results in July, it remains our intention to prepay the remaining £149.4 million of our £250 million 10.375% Senior Notes on their first call date of 31 December 2013 at a prepayment premium of 5.1875%. Following repayment of these Senior Notes, the maturity date on our £100 million term loan extends to 2020 resulting in total committed debt facilities of £650 million with an average maturity of 4.7 years. Before amortisation of arrangement fees, and based on our expected level of borrowings that average higher due to intra period working capital demands, we estimate our net finance cost to be nearly 50% lower next year.
Since September 2011, when Taylor Wimpey set out its debt restructuring strategy, the group has cut net debt by over 40 per cent to £68.4m (as of 30 June 2013).