ClubCorp has announced the completion of a major refinancing of its outstanding bank debt.
Through the simultaneous completion of three separate mortgage portfolio transactions, the company retired the remaining outstanding balance of its bank credit facility while increasing liquidity and working capital. The transaction also extends the majority of the company’s debt maturities to 2010 through 2013. The bank debt was scheduled to mature principally in 2004 and 2007.
The new financing has been provided by Pacific Life ($500 million), GMAC ($61 million), and Textron Financial Corporation ($56 million). Approximately $400 million of the debt is fixed at a weighted average rate of 6.75% for terms ranging from 5 to 10 years. The remainder carries floating rates.
“We are very pleased to have worked with strong partners to help us reposition our debt,” said Bob Dedman, chairman and CEO of ClubCorp. “We are also fortunate to have been able to take advantage of a very favourable interest rate environment to lock in attractive long-term financing at historically low rates. Our focus in the short term remains on reducing the level of debt outstanding while increasing our cash flow to strengthen our balance sheet.”
Dedman added that, as the economy improves, the refinancing will enable ClubCorp to capitalize on future opportunities.
“With the refinancing, combined with recent curtailments of capital spending for acquisitions and expansions, we should generate significant cash flow this year,” Dedman said. “The transaction gives us improved flexibility and reduced interest costs to help us achieve our goals.”
Founded in 1957, Dallas-based ClubCorp has approximately $1.6 billion in assets. Internationally, ClubCorp owns or operates nearly 200 golf courses, country clubs, private business and sports clubs, and resorts including Pinehurst, the world’s largest golf resort. Each year the company’s 19,000 employees serve more than 210,000 member households and 200,000 guests.
ClubCorp www.clubcorp.com