8-KMaterial AgreementsFinancial EventsExhibits & Filings

EQUIFAX INC 8-K Report, Material Agreement (Sep 9, 2004)

Filed September 9, 2004For Securities:EFX

Summary

Equifax Inc. (EFX) reported the closing of a significant trade receivables securitization transaction on September 7, 2004. This transaction establishes a revolving credit facility through a wholly owned finance subsidiary, Equifax Receivables Finance LLC (ERF), allowing ERF to borrow up to $125 million. The facility is backed by domestic trade receivables sold by Equifax's subsidiaries to its parent, Equifax Capital Management, Inc. (ECM), and then to ERF. The proceeds from this securitization will be used by Equifax for general corporate purposes, providing a flexible source of funding. This move indicates Equifax's strategy to leverage its asset base for operational funding and potentially reduce its reliance on traditional debt. The facility has a term of one year, with an option for extension, and is funded by Blue Ridge Funding Corporation and backed by Wachovia Bank. Investors should note that outstanding debt under this facility will be consolidated on Equifax's balance sheet, impacting its financial leverage metrics.

Key Highlights

  • 1Equifax closed a trade receivables securitization transaction on September 7, 2004.
  • 2A new revolving credit facility allows a subsidiary (ERF) to borrow up to $125 million.
  • 3The facility is secured by domestic trade receivables.
  • 4Proceeds will be used for general corporate purposes.
  • 5The credit facility has an initial term of one year, with an option to extend for up to three additional years.
  • 6Wachovia Bank and Blue Ridge Funding Corporation are key financial partners in this transaction.
  • 7Outstanding debt under this facility will be consolidated on Equifax's balance sheet.

Frequently Asked Questions

The primary purpose is to secure a flexible source of funding for general corporate purposes by securitizing its trade receivables. This allows Equifax to access capital by leveraging its existing assets.

Equifax's finance subsidiary, ERF, can borrow up to the lesser of a calculated funding base or $125 million under the revolving credit facility.

The credit facility has an initial expiration date of September 6, 2005, with an option for ERF to request an extension of up to three additional years, provided certain conditions are met.

Yes, outstanding debt incurred under the ERF credit facility will be consolidated on Equifax's balance sheet for financial reporting purposes, which will increase its reported leverage.