Cemex has successfully amended its Facilities Agreement, dated as of July 19, 2017, entered into with several financial institutions.
The amendment is one of the steps in the overall strategy adopted by the Mexican building materials heavyweight to respond to the COVID-19 pandemic.
Cemex has modified the consolidated leverage and coverage covenants in the Facilities Agreement, which should allow the company to manage its compliance. Under the terms of the amendment, the leverage covenant increases to 6.75x for June 2020 and to 7x for September 2020 until March 2021; and decreases after that. As of the end of the first quarter of 2020, Cemex reported a consolidated leverage ratio of 4.4x.
“We are very pleased with the completion of this process and with the support of our lenders,” said Maher Al-Haffar, Cemex’s chief financial officer. “We are proud of our track record in working together with our bank group in both good and challenging times.”
As part of the amendment to the Facilities Agreement, Cemex agreed to temporarily limit certain flexibilities related to capital expenditures, acquisitions and share buybacks, among others, which are in line with its previously announced measures to contain the impact of COVID-19. Furthermore, the interest-rate margin grid has been adjusted to accommodate the changes to the consolidated leverage covenant.
