NeoPhotonics Corp of San Jose, CA, USA (a vertically integrated designer and manufacturer of hybrid photonic integrated optoelectronic modules and subsystems for high-speed communications networks in telecom and data-center applications) has entered into a new five-year $50m revolving credit facility with Wells Fargo Bank, National Association (effective 8 September).
Upon closing, the firm drew $30m under the new facility and will use the proceeds of the credit facility to pay off its existing facility with Comerica Bank and for working capital needs and general corporate purposes.
NeoPhotonics’ existing $30m credit facility with Comerica Bank (under which it borrowed $20m) expired on 31 August and a $39.2m credit line with China’s CITIC Bank (under which it borrowed $17m) expires on 30 September. NeoPhotonics also has additional capacity of about $17.7m from Shanghai Pudong in China (available until early Q1/2018). “Without any recovery in China, there would be doubt that our existing cash [$79m in cash, cash equivalents, short-term investments and restricted cash, down from $91.5m at the end of Q1] would be adequate for the next full year if we did not extend at least one of these credit lines or secure equivalent financing,” said interim chief financial officer Sandra Waechter when reporting NeoPhotonics’ second-quarter 2017 financial results in mid-August.
“This new credit facility provides NeoPhotonics with lower capital costs, an extended maturity and increased borrowing capacity for continued execution against our strategic priorities globally,” comments president & CEO Tim Jenks.
