SCOTTS REACHES AGREEMENT WITH BANKS ON NEW CREDIT FACILITY; COMPANY PLANS TO REDEEM SUBORDINATED DEBT
SCOTTS REACHES AGREEMENT WITH BANKS ON NEW CREDIT FACILITY;
COMPANY PLANS TO REDEEM SUBORDINATED DEBT
MARYSVILLE, Ohio, April 10 /PRNewswire/ -- The Scotts Company (NASDAQ: SCTT) announced today that it has negotiated a new credit facility with a group of commercial banks.
The new credit facility has more favorable borrowing terms and less restrictive covenants than the company's prior credit agreement. With the new credit facility in place, the company said it will move ahead with its plan to redeem its high cost subordinated debt.
Scotts completed an initial public offering earlier in the year that raised approximately $160 million of net proceeds for the company which was used to reduce outstanding debt. The new bank agreement allows redemption of the company's 13 percent subordinated notes and 13-1/2 percent subordinated debentures and provides for future working capital needs.
Scotts interest coverage would have been 3.2X for fiscal year 1991, assuming the prepayment of the term loan as well as the redemption of the company's subordinated debt.
"Our recent initial public offering, permitted us to significantly deleverage the balance sheet, leaving us well positioned to pursue our long-term growth plans," said Tadd C. Seitz, chairman of the board and chief executive officer. "The new credit agreement gives us access to lower cost capital which will improve our profit potential."
With sales of $388 million in fiscal year 1991, Scotts is the country's leading producer and marketer of consumer do-it-yourself lawn care and professional golf course turf care products. The company's Turf Builder products are the nation's most popular lawn care fertilizers and fertilizer/control combinations. The company's Hyponex products are the nation's leading line of organic products, including top soils, potting soils, composted manures and bark mulches.
/CONTACT: Thomas C. Franco or Allison Sargent of Broadgate Consultants, Inc., 212-229-2222, for the Scotts Company/
(SCTT) CO: Scotts Company ST: Ohio IN: HOU SU: PS -- NY004 -- 7099 04/10/92 09:38 EDT