Meadowbrook Insurance Group has received financing commitments totaling $85 million to its proposed $100 million senior credit facilities, which are being arranged by Banc of America Securities.
These commitments, which are from Bank of America, JP Morgan Chase Bank, and KeyBank, were received in advance of the launch of the general syndication of the credit facilities and are subject to the preparation, execution, and delivery of a mutually acceptable credit agreement associated with the credit facilities. Facilities are expected to be received from additional lenders in mid-July 2008.
The proposed credit facilities include a $65 million term loan facility, which is expected to be fully funded at closing and a $35 million revolving credit facility, which is expected to be partially funded at closing. The company intends to utilize approximately $77 million in proceeds from the credit facilities, along with available cash, to finance the cash portion of the merger with ProCentury Corporation. The merger is anticipated to close sometime during the third quarter.
Robert Cubbin, president and CEO of Meadowbrook, said: We appreciate the commitments we have received to date and are confident we will receive commitments for the remaining $15 million within the expected timeframe.
We are pleased with how Banc of America Securities has been managing the process and look forward to finalizing the credit facility within the next several weeks and closing on the merger transaction as soon as all necessary shareholder and regulatory approvals are obtained.