As a result of the bankruptcy, the company's $2.2 billion in debt would be reduced to $300 million and interest expense would be cut by $145 million. . Masonite's words of comfort will likely not provide relief to P/E backer KKR:
"We are very pleased to have reached an agreement in principle on a plan that will allow us to reduce our debt substantially and put Masonite in a stronger, financially healthier position for the future," said Fred Lynch, President and Chief Executive Officer of Masonite. "With an appropriately sized capital structure and greater financial flexibility, along with our excellent market position, strong brand, and industry-leading products, we believe we will be well-positioned to take advantage of market opportunities and grow our business over the long term."This is because the only sure loser in the deal would be KKR itself, which will not only lose the equity, but may be impaired at the bond level: the 11% notes were converted from a KKR-backed bridge loan which was part of the LBO, and and subsequent plans to raise high yield debt were scrapped. Sphere: Related Content
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1 comments:
i thought trough ebitda was supposed to be 150MM?
that figure is likely still way too aggressive. hard to pinpoint what a normalized ebitda figure is in an uber cyclical industry such as this that has just underwent one of the biggest demand pull forwards in existance of the company. that being said bank is indicated sub 40, so if you like the bldg products space could be interesting, especially given the concentration in the industry...big caveat though is do you really want exposure to this industry and how long will they burn $ given the protracted downturn that we're still in the early innings of....
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