01—Abstract
Summary
Summary of the 8-K filed May 9, 2008. Cited figures are marked; the original filing is the authoritative source.
United Rentals, Inc. (URI) announced on May 7, 2008, a significant move to strengthen its financial flexibility by entering into a $1 billiona asset-based revolving credit facility (the "Facility").
This new facility is intended to replace existing credit arrangements, including a cash flow revolver, a letter of credit facility, and a term loan, some of which were maturing in early 2009. The primary purpose of this new Facility is to provide United Rentals (North America), Inc. (URNA) and its subsidiaries with enhanced working capital and funds for other general corporate needs. The new credit facility will be secured by most of the company's assets, excluding real property and accounts receivable.
Notably, URNA's existing $300 millionb accounts receivable-backed facility will continue to operate independently. The company is in the process of syndicating this new facility to other lenders, with the expectation of finalizing and drawing upon the credit agreement in June 2008.
02—Key points
Key Highlights
- United Rentals, Inc. entered into a $1 billion asset-based revolving credit facility.
- The new facility is intended to refinance existing credit lines and term loans.
- Funds from the facility will be used for working capital and general corporate purposes.
- The facility is secured by substantially all company assets, excluding real property and accounts receivable.
- URNA's existing $300 million accounts receivable-backed facility will remain in place.
- The company is syndicating the new facility to additional lenders.
- The definitive credit agreement is expected to be executed and drawn upon in June 2008.
03—Questions
Frequently Asked Questions
What is the main purpose of the new $1 billion credit facility?
The new $1 billion asset-based revolving credit facility is primarily intended to refinance existing credit arrangements, including a cash flow revolver, a letter of credit facility, and a term loan. It will also provide funds for working capital and other general corporate purposes for United Rentals (North America), Inc. and its subsidiaries.
What assets will secure this new credit facility?
The new facility will be secured by substantially all of the company's assets, with the exception of its real property and accounts receivable.
Will the company's existing accounts receivable financing be affected?
No, United Rentals (North America), Inc.'s current $300 million accounts receivable-backed facility will remain in place and is not being refinanced by this new credit facility.
When does the company expect to finalize and use this new credit facility?
United Rentals is currently syndicating the facility to other lenders. The company expects that a definitive credit agreement will be executed and the facility drawn upon in June 2008.
04—Continue