LONDON - A group of direct lenders, spearheaded by HPS Investment Partners and comprising firms including Oaktree Capital Management, KKR & Co (NYSE:KKR)., and Ares Management (NYSE:ARES) Corp., has outmaneuvered Morgan Stanley by providing a $1.14 billion refinancing loan to Consolidated Precision Products Corp. (CPP), Bloomberg reported Monday.
This significant financial move accompanies CPP's successful procurement of $750 million through preferred equity sales.
According to Bloomberg, the financing package, which was completed last week, is structured with a loan maturing in December 2029 at a rate of SOFR plus 6.75 percentage points. It features an innovative payment-in-kind option that permits CPP to pay half the interest margin over the first three years. Additionally, the package includes a $125 million revolving credit facility designed to manage CPP's existing debt obligations, which consist of around $1.2 billion in first-lien loans due in 2025 and about $356 million in second-lien loans.
This strategic refinancing effort by CPP is aimed at improving the company's financial flexibility and reducing the pressure from its current debt load.
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