Accord on credit reworked for Tyson
Deal offers line of up to $2.25B
by Nathan Owens, Arkansas Democrat Gazette (AR)
Oct 7, 2021
Tyson Foods has renegotiated a credit line with JPMorgan Chase Bank that offers up to $2.25 billion over the next five years to help the company pay down expenses.
Springdale-based Tyson Foods has taken on increased costs lately because of covid-19 and legal obligations.
According to the agreement with JPMorgan Chase Bank, disclosed in a shareholder filing Wednesday, the deal requires Tyson to keep its ratio of gross earnings to consolidated interest expense at 3.5-to-1 at the end of each fiscal quarter.
Tyson said in the filing that it would use cash on hand to repay all outstanding obligations under the company's existing term loan agreement, dated March 22. The total outstanding was $500 million.
Expenses have grown during the pandemic, with more than $700 million going toward efforts to prevent the spread of covid-19, as well as additional nursing staffers and vaccinations. Rising raw material costs and labor issues have also affected earnings.
The company last month increased...