Summary
United Rentals, Inc. (URI) filed an 8-K on December 1, 2017, to report an amendment to its receivables purchase agreement. This amendment, specifically Amendment No. 7 to the Third Amended and Restated Receivables Purchase Agreement, marks a significant increase in the company's financing capacity. The total purchase limit and aggregate commitments under this facility have been raised from $675 million to $775 million, representing an additional $100 million in available funding. This expansion of the securitization facility is a positive development for investors, indicating the company's growing needs for working capital or its strategy to enhance financial flexibility. The increased capacity suggests confidence from the lenders involved in the facility, which includes several major financial institutions. This move can support United Rentals' operational growth, potential acquisitions, or simply strengthen its balance sheet by providing greater access to liquidity.
Key Highlights
- 1United Rentals amended its Third Amended and Restated Receivables Purchase Agreement, now referred to as Amendment No. 7.
- 2The amendment, effective December 1, 2017, increases the total purchase limit and aggregate commitments under the securitization facility.
- 3The facility's capacity has been expanded by $100 million, from $675 million to $775 million.
- 4This expansion enhances United Rentals' financial flexibility and access to liquidity.
- 5The amendment involves several financial institutions acting as Purchasers and Purchaser Agents, including The Bank of Nova Scotia, PNC Bank, SunTrust Bank, The Bank of Tokyo-Mitsubishi UFJ, Ltd., Bank of Montreal, and The Toronto-Dominion Bank.
- 6United Rentals reaffirmed its performance undertaking in connection with this securitization facility.
- 7This filing (Item 1.01 and 2.03) pertains to a material definitive agreement and the creation of a direct financial obligation.