XPO Logistics Continues to Restructure Debt
XPO Logistics has priced $1.64 billion in refinancing of its existing term loan, as part of an effort to improve cash flow by reducing annual interest costs by about $40 million.
XPO, which ranks No. 3 on the Transport Topics Top 100 list of the largest U.S. and Canadian for-hire carriers, said the interest rate for the new loan maturing in October 2021 would be 1.25 percentage points lower than the current term loan, which is at 4.5% above the LIBOR, or London Interbank Offered Rate.
The company over the past week has done $2.6 billion in debt refinancing, a statement from the Greenwich, Connecticut-based company said.
CEO Bradley Jacobs told TT that the move would cut annual interest costs by more than 10% from the current $320 million.
“This refinancing is related to our stated goal of generating increased cash flow,” he said. He emphasized the fact that the company is at an inflection point, with the goal of increasing earnings and cash flow instead of concentrating on acquisitions.
Earlier this month, XPO reported its first quarterly profit since the company was created in 2011.
