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Commercial foodservice equipment manufacturer, The Manitowoc Company, Inc. (MTW - Analyst Report), has declared the closure of senior secured credit facilities worth $1.05 billion.

The credit facilities consist of a revolving facility of $500 million, Term Loan A worth $350 million and Term Loan B worth $200 million. While Term Loan A and the revolving facility have a five-year term maturity, Term Loan B will mature in seven years.

The new credit facilities extend the maturity dates of the revolving credit facility and term loans from 2016 and 2017 to 2018 and 2020, respectively. The Term Loan A and revolving facility will bear interest at LIBOR plus 2.25% or 1.25% over an alternate base rate.

The proceeds from this new credit facilities will help the company to redeem its 9.5% Senior Notes due 2018 after reaching the call date in Feb 2014. In addition, the new credit facilities and lower interest expense from the bond redemption will generate interest savings of about $20 million in 2014.

As of Sep 30, 2013, Manitowoc had cash and temporary investments totaling $87.2 million versus $76.1 million as of Dec 31, 2012. Cash flow from operating activities improved substantially to $114 million in the third quarter of 2013 from $49.7 million in the prior-year quarter driven by cash from profitability, partially offset by seasonal working capital requirements in both segments.

However, for full-year 2013, Manitowoc lowered its revenue guidance for the Crane segment from the high single-digit to mid single-digit range. Additionally, this segment will benefit from the introduction of new products and services.

On the other hand, Foodservice revenues are expected to rise in modest single digits, as compared with the mid single-digit growth projected earlier. Margins for both the Crane and Foodservice segments are expected to improve in 2013. However, high debt levels will continue to be a headwind.

Wisconsin-based Manitowoc is one of the world's major innovators and manufacturers of commercial foodservice equipment. The company is among the premier creators and providers of crawler cranes, tower cranes and mobile cranes for the heavy construction industry. These are complemented by industry-leading product support services.

Currently, Manitowoc carries a Zacks Rank #4 (Sell).

However, some better-ranked stocks in the in the sector include Kubota Corp. (KUBTY), Alamo Group, Inc. (ALG - Snapshot Report) and Terex Corp. (TEX - Analyst Report). While Kubota and Alamo Group carry a Zacks Rank #1 (Strong Buy), Terex holds a Zacks Rank #2 (Buy).

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