Brinks Secures Additional Term Loan Financing of $590 Million
The Brinks Company, rated No. 3 on the SDM 100, today announced that it has secured additional term loan financing of $590 million, which is expected to increase liquidity to approximately $1.5 billion upon closing. The new financing will be provided by the company’s existing bank group under the same pricing and conditions as the existing credit facility. Brinks has no long-term debt maturities until 2024.
On Feb. 26, Brinks announced the acquisition of the G4S cash businesses in 17 markets, which is expected to close in multiple transactions throughout 2020. Upon the completion of the acquisition, Brinks is expected to have available liquidity of approximately $800 million.
On March 9, Brink’s completed the acquisition of G4Si, which complements the Brink’s Global Services business that specializes in secure logistics and storage of valuable commodities including banknotes, precious metals, diamonds and jewelry. In 2019, G4Si had a revenue of approximately $95 million. The acquisition of G4Si is expected to further strengthen Brink’s Global Services and generate in the near term more than half of the $20 million of estimated synergies from the total G4S acquisition, which generated approximately $115 million of pro forma adjusted EBITDA in 2019, according to Brinks. Brinks expects to pay an additional $720 million in cash upon completing the purchase of the remaining G4S cash businesses.
On March 17, Brinks disclosed that it expects the COVID-19 pandemic and negative currency translation to reduce its first quarter and full year results. Because of this, the company has withdrawn its 2020 guidance and plans to provide an update on business conditions when it releases first quarter 2020 results.
“Despite the uncertain impact of COVID-19, Brinks is operating from a position of financial strength, with ample liquidity and manageable debt leverage,” said Doug Pertz, president and CEO of Brinks. “We are a designated ‘essential services provider’ in the U.S and in most of our global markets, with a resilient operating model that includes a high level of variable labor and fleet costs, and a diversified base of recurring revenue.
“We are taking decisive action to reduce direct and variable costs in response to temporary near-term revenue declines related to COVID-19, primarily in our retail business. We are also substantially reducing capital expenditures and closely managing working capital to maximize free cash flow. We plan to emerge from this crisis with the G4S cash acquisition completed, poised to successfully execute on our new strategic opportunities and deliver strong profit growth in 2021."