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BGC Partners, Inc. (NASDAQ: BGCP) ("BGC Partners" or "BGC" or "the Company,") a leading global brokerage company servicing the financial and real estate markets, today announced that it has entered into a committed unsecured credit agreement (the "agreement") with a group of lenders. The agreement provides for maximum revolving loans of $150 million, with the option to increase the aggregate loans to $200 million.
"We are very pleased to announce this new credit agreement, which further enhances the Company's operating flexibility with respect to our growth strategy," said Howard W. Lutnick, Chairman and Chief Executive Officer of BGC. "We already have a very strong balance sheet, with more than $1 billion of liquidity. In addition, we expect to receive over $760 million in additional Nasdaq stock over time, which is not yet reflected on our balance sheet.1 This agreement bolsters our already robust financial position, while giving us even more resources we can use to make continued and disciplined investments for the long-term benefit of the Company.
"The agreement, along with our liquidity position, and the expected receipt of 11.9 million Nasdaq shares, means that we have over $1.9 billion of dry powder available to us to drive substantial returns for our investors. We expect to use our considerable financial resources to profitably hire, make accretive acquisitions, pay dividends, repurchase shares and units of BGC, and/or repay debt, all while maintaining or improving our investment grade rating."
On February 25, 2016, BGC entered into a committed unsecured credit agreement with Bank of America, N.A., as administrative agent, and a syndicate of lenders that included Capital One, N.A.; Industrial and Commercial Bank of China Limited, New York Branch; U.S. Bank National Association; Associated Bank, National Association; BankUnited, N.A.; and Western Alliance Bank. Several of the Company's domestic non-regulated subsidiaries are parties to the agreement as guarantors. The maturity date of the facility is February 25, 2018.
Borrowings under this facility will bear interest at either LIBOR or a defined base rate plus an additional margin. This margin will range from 50 basis points to 250 basis points, depending on BGC's debt rating as determined by S&P and Fitch and whether the loan is a LIBOR loan or a base rate loan. Contemporaneously with the closing of this agreement, BGC terminated the $25 million unsecured credit agreement entered into on December 24, 2015 with Bank of America, N.A. As of February 25, 2016, there were no borrowings outstanding under either the $150 million facility or the terminated $25 million facility.
