Summary
Dover Corporation (DOV) has entered into new credit facilities, replacing an existing one. On April 6, 2023, the company finalized a $1 billion, five-year unsecured revolving credit facility, which can be expanded by an additional $500 million. This facility is primarily intended as a liquidity backstop for Dover's commercial paper program and allows for letter of credit issuances up to $250 million. In addition to the five-year facility, Dover also secured a $500 million, 364-day revolving credit facility. This shorter-term facility is designated for working capital, general corporate purposes, and debt repayment. Both facilities have provisions for extension and are subject to customary covenants and events of default, including a minimum interest coverage ratio of 3.00:1.00. The credit terms, including interest rates and facility fees, are tied to Dover's credit rating.
Key Highlights
- 1Dover Corporation entered into a new $1 billion, five-year unsecured revolving credit facility, maturing April 6, 2028.
- 2The company also secured a $500 million, 364-day unsecured revolving credit facility, maturing April 4, 2024, with a one-year extension option.
- 3The five-year facility serves as a liquidity backstop for the commercial paper program and includes a $250 million subcap for letters of credit.
- 4The 364-day facility is intended for working capital, general corporate purposes, and debt repayment.
- 5Both credit facilities have the potential for aggregate commitments to be increased, with the five-year facility allowing for an additional $500 million.
- 6Interest rates and facility fees are variable, based on Dover's senior unsecured debt credit rating from S&P and Moody's, and benchmark rates like SOFR.
- 7The new credit agreements include customary covenants, events of default, and a minimum interest coverage ratio requirement of 3.00:1.00.