Vestis (VSTS) Completes Refinancing Transaction

Vestis (NYSE: VSTS), a leading provider of uniforms and workplace supplies, today announced the successful refinancing of its $800 million 2-year Term Loan A-1 with an $800 million 7-year Term Loan B. The transaction is net leverage neutral and extends the debt maturity by more than five years to 2031.

The new Term Loan B is priced at the Secured Overnight Financing Rate (SOFR) plus 225 basis points, was issued with 0.25% original issue discount and will adjust to SOFR plus 200 basis points after Vestis reaches 3.30x net leverage as defined in the credit agreement.

“We are pleased to announce a successful refinancing, with a Term Loan B structure that reflects our commitment to de-leveraging. The ability to extend our debt maturity from two years to seven years enhances our financial position to advance our strategic plan and drive strong shareholder returns,” said Vestis Chief Financial Officer Rick Dillon. “We remain confident in the strength of our capital allocation strategy and our ability to improve our leverage profile by achieving our optimal net leverage range of 1.5x to 2.5x by FY26.”

In addition to the new Term Loan B, the Company has $691 million remaining on its existing Term Loan A-2 and an undrawn $300 million revolving credit facility, both of which mature in 2028.

Additional details on the terms of the amendment to the credit agreement are available in the Company’s 8-K filed with the Securities and Exchange Commission on February 22, 2024.

The refinancing transaction was led by Wells Fargo Securities, LLC.

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