Howden completes $4.1bn debt repricing at tight levels

Howden Group, a UK-headquartered insurance broker and reinsurance intermediary, has completed a repricing of its US$3.1bn Term Loan B due 2031 and its £765m Revolving Credit Facility (RCF).

The changes, finalised on 8 August, cut the Term Loan B margin by 25 basis points to 275bps over SOFR (Secured Overnight Financing Rate).

The RCF margin was adjusted at the same time. According to the company, the move takes advantage of current credit market conditions and reflects investor willingness to provide funding at reduced spreads.

The lower rates are expected to reduce interest expenses, with the Term Loan B repricing anticipated to generate about US$8m in annualised gross savings.

Mark Craig, Group Chief Financial Officer, said: “I’m delighted that we’ve achieved one of the tightest pricing levels for leveraged loans by an insurance broker in this ratings category, as Howden continues to be well-supported by the capital markets. Being able to make our borrowing more efficient puts us in an even stronger position to continue delivering on our ambitious growth plans.”

Craig continued: “Howden’s leverage remains below many of our peers. Our market-leading organic growth, driven by our differentiated business model, is well above that of our listed peers and continues to make us an attractive proposition for our credit and equity investors.

“We continue to successfully implement this growth strategy globally. Last week, we announced our plans to bring our unique entrepreneurial model to the US retail insurance broking market. So, it’s satisfying to see blue chip institutional lenders and banks support the refinancing of our debt at such historically attractive levels in the same week.”

The Group is rated B2 Stable by Moody’s and B Stable by S&P, and has no debt refinancing obligations until 2030.