Cemex enters new US$1.35bn credit agreement

Cemex enters new US$1.35bn credit agreement
Published: 01 October 2014


Cemex SAB de CV announced it entered a new credit agreement for US$1.35bn with nine of the main lending banks from its Facilities Agreement of 17 September 2012.

The new agreement’s main terms include an average four-year term with equal semi-annual payments of principal of 20 per cent each, with a three-year grace period and September 2019 as the last payment date. In addition, there will be a spread over LIBOR of 250-375 basis points, depending on the level of leverage of the company, and a revolving credit tranche of 40 per cent of the total principal amount with the same maturity. Cemex will also enjoy more flexibility as certain covenants and undertakings have been improved.

 "We are very pleased with the improved terms of this transaction which reflect the better credit profile that CEMEX has achieved in the last years. It also represents CEMEX’s return to the syndicated bank market under conventional conditions," said Jose Antonio Gonzalez, CEMEX’s CFO. "We appreciate the confidence of the participating banks and look forward to their continued support."

The credit agreement will primarily be used to refinance US$1.35bn of indebtness under the Facilities Agreement. Following this repayment, and along with a repayment of US$350m from the proceeds of its senior secured notes issued on 11 September 2014, the Mexico-based cement producer will have repaid a total amount of US$1.7bn, reducing the outstanding principal balance to around US$2.475bn and avoiding a contingent payment of a 0.50% quarterly fee over the outstanding agreement under the Facilities Agreement from the 3Q15 onwards.