8-KMaterial AgreementsFinancial EventsExhibits & Filings

DANAHER CORP /DE/ 8-K Report, Material Agreement (Mar 26, 2018)

Filed March 26, 2018For Securities:DHR

Summary

Danaher Corporation (DHR) announced on March 26, 2018, that it entered into a new $1.0 billion 364-day revolving credit facility on March 23, 2018. This facility provides significant liquidity support and is intended for Danaher's commercial paper programs and general corporate purposes. Notably, the company also plans to use proceeds from its commercial paper to fund a portion of the acquisition of Integrated DNA Technologies, Inc. The credit facility has a variable interest rate structure and requires Danaher to maintain a specific Consolidated Leverage Ratio. While unsecured, it includes customary covenants and events of default. Investors should note the company's ability to convert outstanding loans into term loans at maturity, providing flexibility. This move underscores Danaher's proactive approach to managing its financing needs, particularly in light of ongoing strategic initiatives like the Integrated DNA Technologies acquisition.

Key Highlights

  • 1Danaher established a new $1.0 billion 364-day revolving credit facility maturing on March 22, 2019.
  • 2The facility provides liquidity for Danaher's U.S. and Euro commercial paper programs and general corporate uses.
  • 3Proceeds from commercial paper issuances will help fund part of the acquisition of Integrated DNA Technologies, Inc.
  • 4Interest rates are variable, based on Eurodollar or Base Rates plus specified margins.
  • 5Danaher must maintain a Consolidated Leverage Ratio of 0.65 to 1.00 or less.
  • 6Borrowings are prepayable without penalty.
  • 7The credit facility is unsecured, with customary covenants and events of default, including change of control clauses.

Frequently Asked Questions

The new $1.0 billion 364-day revolving credit facility is primarily intended to provide liquidity support for Danaher's expanded U.S. and Euro commercial paper programs and for general corporate purposes. It will also help fund a portion of the purchase price for the pending acquisition of Integrated DNA Technologies, Inc.

Borrowings bear variable interest rates: Eurodollar Rate Loans are at LIBOR plus 81.5 basis points, and Base Rate Loans are at the highest of the Federal Funds Rate plus 0.50%, Bank of America's prime rate, or the Eurodollar Rate plus 1.0%. Danaher also pays a 6.0 basis point per annum facility fee. Borrowings can be prepaid at any time without penalty.

Yes, the credit facility requires Danaher to maintain a Consolidated Leverage Ratio of 0.65 to 1.00 or less. There are also customary affirmative and negative covenants restricting certain actions by Danaher and its subsidiaries.

The option to convert outstanding loans into term loans that mature one year after the Scheduled Termination Date (March 22, 2019) provides Danaher with financial flexibility. This allows them to extend the maturity of any drawn funds if necessary, beyond the initial 364-day term, subject to certain fees and conditions.