ArvinMeritor Inc. announced Tuesday, Sept. 8, that the company has entered into a new two-year U.S. receivables financing arrangement under which its subsidiary, ArvinMeritor Receivables Corp., will purchase eligible accounts receivable from certain other ArvinMeritor subsidiaries (the “Originators”) and will borrow under a credit facility funded by multiple lenders.
ArvinMeritor says ARC’s borrowings will be secured by an interest in the purchased receivables, and ARC will use the proceeds of the borrowings to fund purchases of receivables from the Originators. The company says the purchased receivables under the new facility are expected to be substantially similar to those under the facility it replaces.
ArvinMeritor says that under the new facility, ARC will be able to borrow monies from a bank group led by GMAC Commercial Finance in an aggregate principal amount outstanding at any one time of not to exceed $105 million; this amount may be increased at the request of ARC and with the consent of the agent to $125 million upon the identification of lenders that may be willing to provide such additional funding. As of the closing date, the borrowing availability under the new facility is expected to exceed the availability under the facility it replaces, according to ArvinMeritor.
“The new facility demonstrates ArvinMeritor’s continued focus on our liquidity,” says Chip McClure, chairman, chief executive officer and president of the Troy, Mich.-based company. “We appreciate the support of the new facility lenders, and look forward to continuing to implement our strategic initiatives that are designed to drive growth.”
ArvinMeritor filed a Form 8-K with the Securities and Exchange Commission that further describes the new facility. To review the company’s filing, go to www.sec.gov.
The company also announced a partnership with Alliance Parts to introduce a new line of remanufactured brake shoes that it will manufacture in North America using its PlatinumShield technology, which helps prevent rust jacking. The brake shoes will be available in a range of high-demand FMSI numbers and are designed for 20,000- and 23,000-pound-axle applications.
Alliance says its remanufactured brake shoes are available at more than 1,000 retail locations, including Freightliner, Western Star and Thomas Built Buses dealers across the United States and Canada.
