US: Constellation Brands amends credit facility
Constellation Brands says move will help reduce debt
Constellation Brands, the world's largest wine firm, has extended portions of its senior credit facility and a long-term loan to help it pay down debt.
The producer of Robert Mondavi wines said today (26 January) that it has extended the repayment date for US$650m of its revolving credit facility from 5 June 2011 to 5 June 2013.
Constellation has also extended the repayment deadline for $300m of a $1.2bn loan, by two years to 5 June 2015.
At the same time, the firm has opted to prepay all $250m of senior subordinated notes due on 15 January 2012.
"We decided to take advantage of our current position and improved credit markets to extend these debt maturities and prepay the 2012 senior subordinated notes, which we expect will lower interest expense," said Constellation chief financial officer, Bob Ryder.
"Our current focus on debt reduction remains unchanged," he said.
Constellation CEO Rob Sands hailed the California-based wine group's progress on reducing debt during a third quarter results conference call earlier this month.
Net debt has fallen by $336m since the start of the firm's fiscal year, to $4.1bn at the end of November.
The company aims to reduce net debt to ebitda ratio from a current 4.2 to sub-4 by the end of current fiscal year, which runs until the end of February.
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