Broadcom (NASDAQ: AVGO) Terminates Existing Credit Agreement and Enters Into New Credit Agreement

Broadcom Inc. announced the termination of its Existing Credit Agreement and entry into a new Credit Agreement in a recent 8-K filing dated January 13, 2025. The termination and subsequent agreement were disclosed on the same day, marking a strategic shift in the company’s financial arrangements.

Under the terminated Existing Credit Agreement, which was dated January 19, 2021, Broadcom had a $7.5 billion unsecured revolving credit facility. Despite having no outstanding borrowings at the time of termination, the Company decided to clear all commitments and repay outstanding obligations. The Existing Credit Agreement’s maturity was set for 2026, with interest rates linked to the alternate base rate or Term SOFR, along with margins based on the Company’s credit ratings.

The new Credit Agreement, effective on the same day as the termination, comprises a $7.5 billion five-year unsecured revolving credit facility named the Revolving Facility. This freshly minted agreement, involving lenders, L/C issuers including Bank of America, N.A., and other concerned parties, allows Broadcom to access capital for general corporate purposes. The terminated Existing Credit Agreement closure facilitated the signing of this new agreement.

The Credit Agreement offers a similar commitment figure of $7.5 billion, with provisions for utilizing up to $500 million for multicurrency letters of credit. The issuance of these letters of credit reduces the available sum for revolving loans under the Revolving Facility. Notably, at the time of signing the new agreement, Broadcom had not drawn any funds under the new Revolving Facility.

The filing noted that certain lenders involved in the terminated Existing Credit Agreement have previously provided, and may continue to offer, various financial services to Broadcom and its subsidiaries, including but not limited to investment banking, financial advisory, lending, and related services.

Kirsten M. Spears, Broadcom’s Chief Financial Officer and Chief Accounting Officer, signed the report on behalf of the company on January 13, 2025.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read Broadcom’s 8K filing here.

Broadcom Company Profile

Broadcom Inc designs, develops, and supplies various semiconductor devices with a focus on complex digital and mixed signal complementary metal oxide semiconductor based devices and analog III-V based products worldwide. The company operates in two segments, Semiconductor Solutions and Infrastructure Software.