Gate Gourmet, the world's largest independent airline catering and logistics provider, completed a debt refinancing for an equivalent of CHF850 million on May 31.

Proceeds of the facilities, which were syndicated by Goldman Sachs and Deutsche Bank, will be used to repay existing debt, to provide additional debt capacity for merger and acquisition activity and for general corporate purposes.

"Recent upgrades by two major credit rating agencies, Gate Gourmet's strong operating performance and our desire to grow the business were the driving factors in our decision to refinance," said Chairman and CEO David Siegel. "The completion of the transaction demonstrates the financial community's confidence in the company's future."

The financing consists of a CHF125 million revolving credit facility, a CHF425 million term loan and a CHF300 million delayed draw term loan. Gate Gourmet will use the proceeds to retire existing first- and second-lien debt.

The refinancing is on a 'covenant-light' basis, which gives the company more financial flexibility, said Guy Dubois, Executive Vice President, Chief Financial Officer and Chief Administrative Officer. In addition, the refinancing enables the company to save several million Swiss francs in annual interest costs, he said.

Dubois said the recent announcements of pending acquisitions of Airport Plaza Flight Services in Goa, India, and of Packattack and POTM, Netherlands-based companies involved in designing and developing packaging concepts, are indicative of Gate Gourmet's strategic direction.

"We have an appetite for sensible growth, both in our core airline catering specialty, and in above-the-wing complementary businesses. Our existing cash position coupled with the debt capacity provided by the refinancing will allow Gate Gourmet the flexibility to take advantage of opportunities as they arise," he said.