By: By Scott Suttell
CRAIN'S CLEVELAND BUSINESS
March 28, 2013
MAYFIELD HEIGHTS OHIO — Ferro Corp., which is the object of an unsolicited takeover offer by Fairlawn, Ohio-based A. Schulman Inc., said it has amended its existing senior credit facility and has reduced its revolving loan commitment by $100 million.
The producer of specialty chemicals said the previously announced sale of its solar pastes assets "increased operating cash flows and significantly reduced the size of the company's precious metal consignment program and other working capital needs."
As a result, Ferro said it's reducing the company's revolving loan commitment to $250 million from $350 million. The amendment "will lower annual commitment fees by approximately $500,000 and modify certain financial and leverage ratio covenants," the company said in a news release.
"Between cash on hand and expected cash from operations, we believe Ferro has sufficient cash resources to fully fund the initiatives now underway to reduce operating costs by over $50 million by the end of 2014," said Peter Thomas, Ferro's interim president and CEO, in a statement.
"By amending Ferro's credit facility, very little of which currently has been utilized, we have gained significant additional financial flexibility to expand upon our cost savings programs and execute on other initiatives in our value creation strategy," he said.