Quality Distribution Inc (QDI), Tampa FL, has completed financial restructuring through an equity infusion and bond exchange. The move has resulted in approximately $70 million of reduced operating company indebtedness and a long term modification to its credit agreement effective through December 31, 2005, according to company information.
In connection with the restructuring, Apollo Management, LP (Apollo), the company’s controlling shareholder, has invested approximately $40 million in preferred stock. In addition, several of the existing holders of the company’s senior subordinated notes and floating interest rate subordinated term securities have exchanged their debt securities for a combination of debt and equity securities. The credit agreement amendment provides for less restrictive loan covenants beginning March 31, 2002, through final maturity, according to company information.
“The financial restructuring and equity infusion by Apollo will enable us to focus on supporting our customers through efficient, timely, and safe transportation of bulk chemicals while increasing value to our shareholders and business constituents," said Tom Finkbiner, Quality Distribution chief executive officer. "By strengthening our balance sheet and significantly reducing our cash interest requirements, QDI will be able to reduce its senior debt over the next several years, freeing up credit availability and allowing us to take advantage of growth opportunities in the chemical transportation markets.”
Josh Harris, founding senior partner for Apollo, said, “Our confidence in QDI’s growth and success is high. The management team and business model have been instrumental in maintaining sound operating ratios, generating positive cash flow, and positioning the company for future growth. As a result, we are investing additional equity in what we know to be a true franchise asset.”