Summary
Linde plc (LIN) announced the execution of two significant unsecured credit agreements on December 7, 2022. The first is a "Five Year Credit Agreement" with initial commitments of $5 billion, extendable up to $6.5 billion, maturing on December 7, 2027. This facility is available for general corporate purposes and allows borrowings in multiple currencies, including USD, GBP, and EUR, with provisions for swingline loans and letters of credit totaling up to $600 million. The second agreement is a "364-Day Credit Agreement" with initial commitments of $1.5 billion, expiring approximately one year after its execution. Similar to the five-year agreement, it supports general corporate needs and allows for multi-currency borrowings and swingline loans. Both agreements are unsecured, feature a ratings-based pricing grid for interest margins, and notably, do not include financial maintenance covenants, which generally provides greater flexibility for the company. As of the filing date, neither credit facility had any outstanding usage.
Key Highlights
- 1Linde plc entered into a $5 billion (potentially up to $6.5 billion) unsecured five-year revolving credit facility maturing in December 2027.
- 2A separate $1.5 billion unsecured 364-day revolving credit facility was also established, expiring in approximately one year.
- 3Both credit agreements are available for general corporate purposes and allow for multi-currency borrowings.
- 4The facilities include provisions for swingline loans and letters of credit, with combined limits under the five-year agreement up to $600 million.
- 5Interest rates are variable, based on benchmarks like SOFR, EURIBOR, or SONIA, plus a margin determined by Linde's credit ratings.
- 6A key feature for investors is the absence of financial maintenance covenants in both agreements, offering operational flexibility.
- 7As of the filing date, there was no outstanding balance drawn on either of the newly established credit facilities.