Watsco – WSO – $500 million senior unsecured revolving credit agreement

Watsco, Inc. (NYSE:WSO) announced that it has closed on a $500 million senior unsecured revolving credit agreement.

WSO intends to use the facility for repayment of current credit facilities, working capital, acquisitions and other general corporate purposes. Borrowings under the five-year credit agreement are LIBOR-based dependent on certain financial ratios.

Albert Nahmad, Watsco’s Chairman & Chief Executive Officer said: “We consider this agreement to be a critical asset of the Company to provide the capacity to grow our network, add products and consider almost any-sized investment in our industry. With this agreement, we have also simplified our borrowing structure while adding flexibility. We appreciate the ingenuity, support and commitment of our bank group in getting this done.”

The bank group under the agreement was led by JPMorgan Chase Bank as Administrative Agent, Bank of America and Wells Fargo Bank as Co-Syndication Agents and U.S. Bank National Association as Documentation Agent.

WSO improves indoor living and working environments with air conditioning and heating solutions that provide comfort regardless of the outdoor climate. Our solutions also promote healthier indoor spaces by removing pollutants from the indoor air that can lead to asthma, allergies and reductions in productivity. Furthermore, since heating and cooling accounts for approximately 56% of the energy consumed in a typical United States home, we offer consumers the greatest opportunity to save money on energy by replacing existing air conditioning and heating systems with more energy efficient and environmentally friendly solutions.

There are approximately 89 million central air conditioning and heating systems installed in the United States that have been in service for more than 10 years. Older systems often operate below today’s government mandated energy efficiency and environmental standards. WSO has an opportunity to accelerate the replacement of these systems at a scale greater than our competitors as the movement toward reducing energy consumption and its environmental impact continues. We operate from more than 575 locations in the United States, Canada, Mexico and Puerto Rico, with additional market coverage on an export basis to Latin America and the Caribbean. As the industry leader, significant growth potential remains given that our current revenue run-rate is less than 10% of the estimated $35 billion marketplace in the Americas for HVAC/R products.

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Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.