MRC Global Streamlines Capital Structure With New $350 Million Term Loan and Convertible Preferred Stock Repurchase Investing.com
HOUSTON, Oct. 29, 2024 (GLOBE NEWSWIRE) — MRC Global Inc. (NYSE: NYSE:), announced today that it has acquired a new $350 million Senior Secured Term B (Term Loan) maturing in 2031.
Proceeds from this loan, along with a loan from an asset-backed credit facility were used to repurchase all 363,000 shares of its 6.50% Series A Convertible Perpetual Preferred Stock for $361 million plus accrued interest as part of an agreement with Mario Investments LLC, owner . of preferred stock.
Rob Saltiel, MRC Global President and CEO said, We took advantage of favorable credit market conditions to issue new term debt, which allows us to repurchase preferred stock. We expect these repurchases to be accretive to both cash generation and earnings per share in 2025 and beyond. Additionally, this transaction simplifies our capital structure and eliminates potential equity dilution through the conversion of preferred shares into common stock.
A previously announced amendment to the company’s asset-based borrowing facility that extends the maturity date to 2029, is still in effect and is expected to be completed in November 2024.
About MRC Global Inc.
Headquartered in Houston, Texas, MRC Global (NYSE: MRC) is a leading global distributor of pipes, valves, fittings (PVF) and other infrastructure products and services to diverse end markets including gas utilities , downstream, industrial change and energy, and the manufacturing and transfer sectors. With more than 100 years of experience, MRC Global has provided customers with innovative supply chain solutions, technical product expertise and a robust digital platform from a global network of 219 locations including valves and engineering centers. The company’s unmatched quality assurance system offers more than 300,000 SKUs from more than 8,500 suppliers, facilitating the supply chain for nearly 10,000 customers. Find out more at www.mrcglobal.com.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Words such as will, expect, expect, and similar expressions are intended to identify forward-looking statements.
Statements about the company’s business, including the company’s expectation that the transactions described in this release will achieve both cash generation and earnings per share in 2025 and beyond, are not guarantees of future performance. These statements are based on management’s expectations which involve a number of business risks and uncertainties, any of which could cause actual results to differ materially from those expressed or implied by the forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors, many of which are difficult to predict and many of which are beyond MRC Global’s control, including factors described in the company’s SEC filings that may adversely affect the company’s actual results and performance. materially different from any future results or performance expressed or implied by these forward-looking statements.
These risks and uncertainties include (among others) declines in capital and other cost levels in the industries served by the company; General US and international economic conditions; national events; the decline in oil prices; lack of surprises; loss of third-party transportation providers; cost increases by the company’s suppliers and transportation providers; increases in metal prices, which the company may not be able to pass on to its customers, which could significantly reduce the company’s profitability; the company’s lack of long-term contracts with many of its suppliers; price reductions by suppliers of products sold by the company, which could cause the value of its assets to decrease; a decline in the price of steel, which could significantly reduce the company’s profitability; a decrease in demand for certain products that the company distributes if prices and services for these products are set or increased; holding inventory in excess of what can be sold at the time of sale; significant substitution of renewable and low-carbon fuels for oil and gas, impacting demand for the company’s products; risks related to severe weather events or natural disasters; environmental, health and safety laws and regulations and their interpretation or application; changes in the company’s customer and product mix; the risk that manufacturers of products that the company distributes will sell a significant amount of goods directly to end users in the industry sectors served by the company; failure to conduct the company’s business in an efficient or orderly manner; the company’s ability to compete effectively with other companies; the company’s lack of long-term contracts with many of its customers and the company’s lack of contracts with customers requiring small purchase amounts; the inability to attract and retain employees or the loss of key employees; adverse health events, such as an epidemic; interference with the proper functioning of the company’s information systems; the occurrence of cybersecurity incidents; risks related to the suitability of the company’s customers; the success of acquisition strategies; potential adverse effects associated with the acquisition integration and whether this acquisition will deliver the intended benefits; impairment of the company’s profits or other intangible assets; adverse changes in political or economic conditions in the countries where the company operates; the company’s gross debt; dependence on the company’s subsidiaries for cash to meet the obligations of the parent company; changes in the company’s credit profile; inability to obtain necessary funds; the adequacy of the company’s insurance policies to cover losses, including liabilities arising from lawsuits; product liability claims against the company; pending or future asbestos-related claims against the company; exposure to US and international laws and regulations, which regulate corruption, restrict imports or exports or impose economic sanctions; risks related to the ongoing review of internal controls required by Section 404 of the Sarbanes-Oxley Act; risks related to changes in laws and regulations including trade policies and tariffs; and potential stock price volatility and costs incurred in response to any share ownership campaigns.
For a discussion of key risk factors, please see the risk factors disclosed in the company’s SEC filings, which are available on the SEC’s website at www.sec.gov and on the company’s website, www.mrcglobal.com. MRC Global’s documents and other important information are also available on the investor page of the company’s website at www.mrcglobal.com.
Undue reliance should not be placed on the company’s forward-looking statements. Although forward-looking statements reflect the company’s good faith beliefs, reliance should not be placed on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which may affect the company’s actual results, performance or success or future events. differ materially from the expected future results, performance or achievements or future events expressed or implied by such forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, except as required by law.
Contact person:
Monica Broughton
VP, Investor Relations and Treasury
Company MRC Global Inc.
Monica.Broughton@mrcglobal.com
832-308-2847
Source: MRC Global
