Mueller Water Products, Inc. announced that it has successfully refinanced its long-term debt and reduced its total debt outstanding.

As part of the refinancing transactions, the company has entered into a new $500 million senior secured term loan bearing interest at LIBOR +325 basis points with a 0.75% LIBOR floor. The new term loan has a "covenant lite" structure and matures on November 25, 2021. The company expects to make scheduled quarterly principal payments of $1.25 million beginning in March 2015, and may make voluntary prepayments at any time. The term loan was issued at 99.5% of the principal amount.

The company expects to realize annualized interest expense savings of approximately $22 million, and that total fiscal 2015 interest expense, net will be about $27 million, assuming that LIBOR remains at or below the floor and before the effect of interest rate risk management activities, if any. In fiscal 2014, interest expense, net was $49.6 million.

The company is using the proceeds from the new $500 million senior secured term loan to fund, in part, its previously announced cash tender offers for any and all of its outstanding 7.375% Senior Subordinated Notes and any and all of its outstanding 8.75% Senior Unsecured Notes, which had an aggregate face value of $545 million. With respect to any notes not tendered, the company will call the applicable notes and/or satisfy and discharge the related indentures.

The company expects to record a loss on early extinguishment of debt, including the write-off of all related deferred finance amounts, of approximately $31 million during the quarter ending December 31, 2014. Concurrently with the company's entry into the term loan, the company also amended its ABL Agreement to facilitate the refinancing transactions.

Mueller Water Products, Inc. is a leading manufacturer and marketer of products and services used in the transmission, distribution and measurement of water in North America.