Hostess Brands: Completes Strategic Refinancing

Kansas City / MO. (twnk) Hostess Brands Inc., one of the largest manufacturers and marketers of sweet baked goods in the United States including «Twinkies», «Ding Dongs», «Ho Hos», «Donettes» and a variety of new and classic treats, announced the completion of a debt refinancing, including the repricing of its existing First Lien Term Loan and the refinancing of its existing debt into an all first lien capital structure.

Under the refinancing, the Company’s First Lien Term Loan was repriced from Libor plus 3.50 percent to Libor plus 3.00 percent, resulting in an interest rate reduction of 50 basis points, while the remaining 83 million USD of the Company’s Second Lien Term Loan with an interest rate of Libor plus 7.50 percent was refinanced with an incremental 83 million USD First Lien Term Loan at Libor plus 3.00 percent. The Company expects to realize approximately 8 million USD of interest expense savings annually, or approximately 0.04 USD of basic earnings per share to common shareholders, as a result of the refinanced capital structure. No covenants were changed and the First Lien Term Loan continues to have a maturity date of August 03, 2022.

«We are very pleased with the refinancing of our debt and the ongoing support from our banking partners and debt holders», said Bill Toler, President and Chief Executive Officer of Hostess, in a news release. «These refinancing activities build on the success of our operational initiatives and reflect the strength of our business model and cash flow. We believe our new all first-lien capital structure, along with our healthy financial condition, will provide our business with the financial flexibility required to support our continued long-term growth».