Cencora, Inc. (COR, Financial) has announced significant amendments to its financial agreements, aimed at enhancing the company's liquidity and operational flexibility. On October 9, 2024, Cencora and its subsidiaries entered into an Amended and Restated Credit Agreement, which modifies the existing revolving credit facility. This agreement, involving JPMorgan Chase Bank, N.A. as the administrative agent, extends the maturity date of the facility to October 9, 2029, reduces applicable facility fees, and replaces the Canadian Dealer Offered Rate with the Canadian Overnight Repo Rate Average (CORRA) for loans in Canadian Dollars.
The interest rates on borrowings under this facility are determined by Cencora's public debt ratings, with rates ranging from 80.5 to 122.5 basis points over various benchmarks such as Term SOFR and Term CORRA. The company retains the flexibility to prepay borrowings and adjust commitments under the facility, which includes provisions for letters of credit up to $100 million.
In addition to the credit facility amendments, Cencora's subsidiaries have also executed a Twenty-First Amendment to the Amended and Restated Receivables Purchase Agreement. This amendment extends the term of the trade receivables securitization facility to October 8, 2027. The securitization facility, which has a base limit of $1,450 million, provides additional liquidity based on accounts receivables from pharmaceutical sales. It includes an option to increase commitments by $250 million for seasonal needs.
These strategic financial adjustments are designed to support Cencora's ongoing business needs and enhance its financial stability. The company continues to maintain strong relationships with its lenders, who have historically provided a range of financial services, including investment banking and advisory roles.
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