Summary
The Sherwin-Williams Company (SHW) announced on February 7, 2006, the establishment of a $500 million accounts receivable securitization borrowing facility, effective February 1, 2006. This facility involves a wholly-owned subsidiary, SWC Receivables Funding LLC (SWC), to which Sherwin-Williams will sell or contribute its receivables. SWC will then use these receivables as collateral to borrow funds up to the $500 million limit from various lenders, with Citicorp North America, Inc. acting as Program Agent. This arrangement allows Sherwin-Williams to access a significant source of liquidity by leveraging its accounts receivable. While SWC will be consolidated into Sherwin-Williams' financial statements, the company will continue to act as the Servicer, managing the collection of these receivables. As of the filing date, there were no outstanding borrowings under this new facility. This move is likely intended to enhance the company's financial flexibility and working capital management.
Key Highlights
- 1Establishment of a $500 million accounts receivable securitization borrowing facility.
- 2A wholly-owned subsidiary, SWC Receivables Funding LLC, is utilized in this financing structure.
- 3Sherwin-Williams will sell/contribute receivables to SWC.
- 4SWC will use the receivables as collateral to borrow funds.
- 5Citicorp North America, Inc. is the Program Agent for the facility.
- 6Sherwin-Williams will continue to service the collected receivables.
- 7No borrowings were outstanding under the facility as of the filing date.