Q: Hi Peter
Can you comment on Knight (GUD) $100MM US revolving bank credit facility released on Oct 31. How material is this in your view. And also would they be paying standby fees for having this facility. Appreciate your thoughts. Thank you
Can you comment on Knight (GUD) $100MM US revolving bank credit facility released on Oct 31. How material is this in your view. And also would they be paying standby fees for having this facility. Appreciate your thoughts. Thank you
5i Research Answer:
It is interesting but not hugely material. GUD has gone from 'lots of cash' to a more or less neutral balance sheet, and if it wants to grow or acquire companies it is likely going to use debt now. A standby fee will be paid on any unused amount, but the fee was not disclosed. We would not read too much into this. It does show than lenders see GUD as a good credit, but does not mean anything will automatically happen in the M&A field.