Allied Holdings, Lenders Agree To Amend DIP Loan
Mardi 11 juillet 2006 / 16h10
By Patrick Fitzgerald Of DOW JONES NEWSWIRES WASHINGTON -(Dow Jones)- Allied Holdings Inc. (AHI) said Tuesday in a regulatory filing that its bankruptcy lenders have agreed to waive the company's default under its debtor-in-possession loan.
Under the fifth amendment to its $230-million debtor-in-possession loan, Allied Holdings isn't in default and no longer has to pay higher default interest on the outstanding amounts under the loan.
The DIP lenders, led by General Electric Co.'s (GE) GE Capital Corp. and Morgan Stanley's (MS) Morgan Stanley Senior Funding Inc., had agreed to a series of forbearances in recent months after Allied Holdings failed to meet certain financial covenants under the DIP loan.
Morgan Stanley, as the agent, also agreed to provide an additional $30-million term loan to the auto hauler. Interest on the loan is the London interbank offered rate plus 9.5%, and the maturity date is June 30, 2007.
The lenders also cut the interest rate on Allied Holdings' $80-million Term B loan to Libor plus 8.5%, from Libor plus 9.5%.
Allied will pay Morgan Stanley a closing fee of $150,000 for the new $30-million DIP loan and $195,000 to its DIP lenders for amending its original loans.
The fifth amendment to the loan is subject to approval by the U.S. Bankruptcy Court in Newnan, Ga. The court has scheduled a hearing for Wednesday on Allied's request.
Allied Holdings, which has been in bankruptcy since last July, is currently negotiating with its unionized employees, represented by the Teamsters, on a package of wage and benefit cuts the company says it needs to survive.
Decatur, Ga.-based Allied Holdings and 23 subsidiaries filed for Chapter 11 bankruptcy protection last July 31, listing assets of $132 million and debts of $180 million.
The company, one of the largest transporters of vehicles in North America, blamed its falling revenue on a decline in deliveries due to automakers' scaled-back production.
-By Patrick Fitzgerald, Dow Jones Newswires; 202-862-3544; patrick.fitzgerald@dowjones.com