Gehl Company Reaches Forbearance Agreement with Lenders
West Bend, Wis.-based Gehl Co. last week announced that as part of its ongoing discussions with its U.S. bank lenders, it has entered into a Forbearance Agreement with its lender group. Previously, the company’s principal source of liquidity was a revolving credit agreement entered into in October 2006 with a group of U.S. bank lenders that as of March 31, has approximately $117 million outstanding.
The Forbearance Agreement rescinds and withdraws the notice of debt repayment delivered on March 31, and allows the company access to credit under the revolving credit agreement and provides a 75-day time period to complete the negotiation of a further amendment to the credit agreement, subject to customary terms and conditions.
The company has repaid a portion of the outstanding borrowings to its lenders using cash generated from operations and anticipates making additional debt repayments in 2009 using cash generated from operations. The company also anticipates entering into a long-term secured credit facility within the extension time period to replace the existing revolving credit agreement.
Gehl Co. is a manufacturer and worldwide distributor of compact equipment used worldwide in construction and agricultural markets. In October 2008, Gehl Co. became a subsidiary of the Manitou Group. The company markets its products under the Gehl and Mustang brand names.