Summary
Parker-Hannifin Corporation (PH) has announced the establishment of significant new credit facilities to finance a portion of its proposed acquisition of Filtration Group Corporation. On December 10, 2025, the company entered into two agreements: a $5.25 billion 364-day term loan facility with Barclays Bank PLC and a $2.50 billion three-year term loan facility with KeyBank National Association. These unsecured, delayed draw facilities collectively provide up to $7.75 billion in committed financing, underscoring the substantial capital required for the Filtration Group acquisition. The terms include customary covenants, events of default, and interest based on SOFR plus an applicable margin tied to the company's credit ratings.
Key Highlights
- 1Parker-Hannifin secured a $7.75 billion financing package through two new credit agreements: a $5.25 billion 364-day term loan and a $2.50 billion three-year term loan.
- 2The primary purpose of these new credit facilities is to finance a portion of the cash consideration for the proposed acquisition of Filtration Group Corporation.
- 3The credit facilities are structured as delayed draw term loan facilities, meaning funds can be drawn as needed, rather than all at once.
- 4The facilities are senior unsecured and will bear interest at SOFR plus an applicable margin, which is dependent on Parker-Hannifin's credit ratings from major agencies.
- 5Key covenants include maintaining a debt to capitalization ratio and restrictions on liens, mergers, and asset sales outside the ordinary course of business.
- 6The agreements contain standard events of default, including non-payment, breaches of covenants, defaults on other material indebtedness, and bankruptcy.
- 7As of December 10, 2025, no funds have been borrowed under these new credit facilities.
Frequently Asked Questions
Parker-Hannifin has secured a total of $7.75 billion through the two credit agreements: a $5.25 billion 364-day term loan facility and a $2.50 billion three-year term loan facility.
The proceeds from these credit facilities, if and when drawn, will be used by Parker-Hannifin to finance a portion of the consideration for its proposed acquisition of Filtration Group Corporation.
The credit facilities are senior unsecured delayed draw term loan facilities.
The loans bear interest at a secured overnight financing rate (SOFR) plus an applicable margin. The applicable margin is determined by Parker-Hannifin's then-current credit rating by Moody's, S&P, or Fitch for its senior, unsecured, non-credit-enhanced long-term indebtedness.