Wyndham Hotels & Resorts, Inc. (NYSE: WH) shares gained ground Tuesday. The New Jersey-based hotel chain today announced that it successfully completed the repricing of its existing $1.1 billion Senior Secured Term Loan B Facility due May 2030.
The Term Loan B garnered significant investor demand, resulting in an upsize of $400 million while in market and an attractive interest rate of Secured Overnight Financing Rate plus 1.75%, which represents a 60 basis point reduction, at an issue price of 99.875% - the tightest priced new money raise in the entire SOFR era. The repricing on the existing $1.1-billion Term Loan B is expected to result in annual interest expense savings of approximately $6 million. There is no change to the Company's maturities or covenants from the repricing on the now combined $1.5 billion dollar facility.
Said Chief Financial Officer Michele Allen, "The opportunity to reprice this loan with a meaningful spread reduction and upsize by $400 million would not have been possible without the outstanding performance of our business over the past year. We are extremely pleased with the elevated market demand, which underscores strong investor confidence in our asset-light, highly cash-generative franchise business model and enabled us to secure best-in-class pricing, further fortifying our financial flexibility."
Wyndham intends to use the net proceeds for general corporate purposes, including the repayment of outstanding balances under the Company's revolving credit facility.
WH shares opened Tuesday trading up 26 cents to $70.61.
