Summary
Flex Ltd. (FLEX) has announced the entry into a new senior term loan credit facility totaling $1.45 billion, effective May 29, 2026. This new facility, provided by Citibank, N.A. as administrative agent and various lenders, matures on November 29, 2027. The proceeds are intended for general corporate purposes, including the refinancing of the company's existing 364-day facility, which was used in part to fund the recent acquisition of Electrical Power Products, Inc. The new credit agreement replaces the previous facility in its entirety. The Credit Facility includes customary covenants and financial maintenance requirements, such as a Debt/EBITDA Ratio not to exceed 4.00 to 1.00 and an Interest Coverage Ratio of no less than 3.00 to 1.00. These covenants are typical for such financing and aim to ensure the company maintains a healthy financial position. Investors should note that while no subsidiaries are currently guarantors, the company has the option to designate them as such in the future. The full terms and conditions are detailed in the Credit Agreement filed as an exhibit.
Key Highlights
- 1Flex Ltd. secured a new $1.45 billion senior term loan credit facility.
- 2The facility matures on November 29, 2027.
- 3Proceeds will be used for general corporate purposes, including refinancing of an existing 364-day facility.
- 4The new credit facility fully funded the repayment and termination of the existing 364-day facility.
- 5Key financial covenants include a maximum Debt/EBITDA Ratio of 4.00:1.00 and a minimum Interest Coverage Ratio of 3.00:1.00.
- 6The agreement contains standard covenants restricting indebtedness, liens, asset dispositions, and mergers, among other provisions.
- 7The company has the option to add subsidiary guarantors at a later date.