8-KMaterial AgreementsFinancial EventsOther Events+1

W.W. GRAINGER, INC. 8-K Report, Material Agreement (Sep 1, 2015)

Filed September 1, 2015For Securities:GWW

Summary

W.W. Grainger, Inc. (GWW) has filed an 8-K report on September 1, 2015, detailing the completion of its acquisition of Cromwell Group (Holdings) Limited. This strategic acquisition, pursued through its indirect wholly-owned subsidiary GWW UK Holdings Ltd, marks a significant expansion for Grainger within the UK market. The company has secured a £180 million financing package to fund this transaction and for general corporate purposes. This financing comprises a £160 million term loan and a £20 million revolving credit facility, provided by Lloyds Bank PLC and Lloyds Securities Inc. The term loan will be used to cover a portion of the Cromwell acquisition cost and related expenses. The revolving credit facility is earmarked for general corporate and working capital needs. The acquisition's closure on September 1, 2015, signifies the integration of Cromwell as a direct, wholly-owned subsidiary, indicating a forward-looking move to enhance Grainger's global footprint and service offerings.

Key Highlights

  • 1Completion of the acquisition of Cromwell Group (Holdings) Limited on September 1, 2015.
  • 2Financing secured for the acquisition through a £180 million Facilities Agreement with Lloyds Bank PLC and Lloyds Securities Inc.
  • 3The £180 million financing includes a £160 million term loan (Facility A) and a £20 million revolving credit facility (Facility B).
  • 4Facility A proceeds are primarily used to fund a portion of the Cromwell acquisition purchase price and related costs.
  • 5Facility B proceeds are designated for general corporate and working capital purposes.
  • 6The Facilities Agreement is unsecured, with W.W. Grainger, Inc. providing an unconditional guarantee for the borrowers' obligations.
  • 7The interest rate on the loans is LIBOR plus a margin, adjustable based on Grainger's debt rating, with an initial margin of 0.75%.

Frequently Asked Questions

This 8-K filing announces the completion of W.W. Grainger's acquisition of Cromwell Group (Holdings) Limited and details the financing arrangements for this acquisition.

The acquisition was financed through a £180 million Facilities Agreement, which includes a £160 million term loan used to partially fund the purchase and a £20 million revolving credit facility for general corporate and working capital needs.

The Facilities Agreement provides for term loans of £160 million and revolving credit facilities of up to £20 million. The loans initially bear interest at LIBOR plus a margin of 0.75%, which can adjust based on Grainger's debt rating. The facility is unsecured, and Grainger has provided an unconditional guarantee.

The acquisition closed on September 1, 2015. The £160 million term loan will be repaid in installments starting February 29, 2016, through February 29, 2020. The revolving credit facility has repayment terms that are generally at the conclusion of each interest period.