8-KMaterial AgreementsFinancial EventsExhibits & Filings

AFFILIATED MANAGERS GROUP, INC. 8-K Report, Material Agreement (Jan 22, 2019)

Filed January 22, 2019For Securities:AMGMGRBMGRMGRDMGRE

Summary

Affiliated Managers Group, Inc. (AMG) filed this Current Report on Form 8-K to disclose the execution of new credit agreements. Specifically, the company entered into an Amended and Restated Credit Agreement for a $1.25 billion five-year senior unsecured revolving credit facility and a Third Amended and Restated Term Credit Agreement for a $450 million four-year senior unsecured term loan credit facility. Both agreements mature in January 2024 and January 2023, respectively, and are with Bank of America, N.A. as the administrative agent. These new agreements amend and restate prior credit facilities. The proceeds from the revolving credit facility were primarily used to refinance existing debt, with future borrowings available for general corporate purposes, including investments, debt repayments, stock repurchases, and dividends. The company also retains the option to increase commitments under both facilities, indicating a flexible approach to capital management and potential future growth initiatives. The filing also notes customary covenants and events of default.

Key Highlights

  • 1AMG entered into new senior unsecured credit agreements on January 18, 2019.
  • 2A $1.25 billion, five-year revolving credit facility matures on January 18, 2024.
  • 3A $450 million, four-year term loan facility matures on January 18, 2023.
  • 4Bank of America, N.A. serves as the administrative agent for both facilities.
  • 5The revolving credit facility proceeds were used to refinance existing debt, with future funds available for working capital and general corporate purposes.
  • 6The company has the option to increase the revolving credit facility by up to $500 million and the term loan by up to $75 million.
  • 7The agreements include financial covenants related to leverage and interest coverage, as well as customary affirmative and negative covenants.

Frequently Asked Questions

The primary purpose of these new credit agreements is to amend and restate AMG's existing credit facilities, providing a $1.25 billion revolving credit facility and a $450 million term loan. The revolving credit facility was used to refinance existing debt, and future borrowings can be used for general corporate purposes, including investments, debt repayment, stock buybacks, and dividends.

The Amended and Restated Credit Agreement provides for a $1.25 billion five-year senior unsecured revolving credit facility maturing on January 18, 2024. The Third Amended and Restated Term Credit Agreement provides for a $450 million four-year senior unsecured term loan credit facility maturing on January 18, 2023.

Yes, AMG has the option to increase the commitments under the Revolving Credit Agreement by up to $500 million and borrow up to an additional $75 million under the Term Credit Agreement, subject to certain conditions.

Yes, the Credit Agreements contain financial covenants with respect to leverage and interest coverage, as well as customary affirmative and negative covenants. However, many of these conditions and restrictions are subject to certain minimum thresholds and exceptions.