Tecnoglass to Issue $210 Million USD of Senior Notes

Barranquilla-based window and glassmaker Tecnoglass Inc. today announced that it has entered into a purchase agreement to sell $210 million of five-year senior unsecured notes at a fixed rate of 8.2% in order to pay off debt. In a transaction the company expects to settle by January 30, Tecnoglass plans to repay around $185 million in obligations, fund working capital needs, and devote some of the proceeds to general corporate purposes.

The firm, which also manufactures aluminum products from its headquarters on the Caribbean coast, believes this move will cut the average cost of debt by approximately 70 basis points. Some 92% of its remaining debt will be fixed rate compared to only 7% last September, according to Tecnoglass.

In addition, the company says that the offering will extend the average maturity of its borrowings and rid it of capital amortization payments from existing lines of credit that are repaid. Overall, Tecnoglass believes the transaction will improve its overall capital structure and financial flexibility.

“We are delighted with this senior notes offering, which will represent our company’s debut in the international debt capital markets,” said Jose M. Daes, CEO of Tecnoglass. “We believe the successful pricing of this transaction will enable us to achieve a lower cost of debt and strengthen our capital structure. We are encouraged by this vote of confidence from the investment community.”

Photo credit: Tecnoglass