Shelter Components Corporation Completes Debt Financing Agreements

Strategic Insights -

Shelter Components Corporation, a nationwide distributor of components for manufactured housing and recreational vehicles, has announced the completion of debt financing agreements with its primary lenders. The agreements will permit the Company to expand its operations and meet the increased demands of its markets. The Company has secured a three-year $25 million revolving line of credit with Society National Bank of Indiana and a ten-year $15 million private placement agreement with Mass Mutual Life Insurance Company.

Key Takeaways:

  • Shelter Components Corporation completed a three-year $25 million unsecured revolving line of credit agreement with Society National Bank of Indiana on March 27, 1995.
  • The revolver bears interest at LIBOR-based rates, providing flexibility in interest payments.
  • Shelter signed a ten-year, $15 million, 9.24% unsecured private placement agreement with Mass Mutual Life Insurance Company on February 21, 1995.
  • The agreement requires interest only for three years, with principal amortization commencing in March 1998.
  • A portion of the proceeds from the private placement agreement were used to retire certain liabilities and obligations assumed in the Company's January 1995 acquisition of BABSCO, Inc.
  • The debt financing agreements will enable Shelter to continue expanding its operations, primarily in the manufactured housing and recreational vehicles markets.
  • The Company distributes components, fasteners, building products, floor covering, plumbing, electrical products, and interior furnishings nationally from 14 regional distribution warehouses located in 14 states.
  • Shelter manufactures carpet in Georgia, thermoforms bath products in Michigan and Texas, and laminates decorative wallboard in Indiana, Georgia, Tennessee, and Texas.

Statistics:

  • $25 million: The amount of the three-year revolving line of credit agreement with Society National Bank of Indiana.
  • 3 years: The term of the revolving line of credit agreement.
  • LIBOR-based: The interest rate for the three-year revolving line of credit agreement.
  • $15 million: The principal amount of the ten-year private placement agreement with Mass Mutual Life Insurance Company.
  • 9.24%: The interest rate for the private placement agreement.
  • 3 years: The interest-only period for the private placement agreement.
  • March 1998: The start date for principal amortization in the private placement agreement.

Sources:

  • PRNewswire, "Shelter Components Corporation (SST) Announces Completion of Debt Financing Agreement" (March 29, 1995)
  • Shelter Components Corporation, Annual Report (1995)