Jeld-Wen Weighs Amend-and-Extend Deal That Could Elevate Unsecured Holders

What Jeld-Wen Is Trying to Do

Jeld-Wen Holding Inc., the window and door maker, is negotiating with creditors on an amend-and-extend that may include new capital from unsecured creditors. That infusion would let those investors obtain secured status. One proposal being discussed would also push unsecured noteholders to a first-lien slot, putting them on equal priority with the existing term loan lenders.

First-lien lenders on the loan maturing in 2028 can choose to roll their positions at par or accept repayment at a discount. The new capital would be used to pay off lenders who do not extend and to reinforce the balance sheet.

Who Is Advising Whom

The lender faction hired Moelis & Co. to advise on finances, while legal matters are being handled by Gibson Dunn & Crutcher. Unsecured noteholders have retained Houlihan Lokey Inc. and Davis Polk & Wardwell to represent them. Jeld-Wen has engaged Evercore Inc., according to Bloomberg.

Representatives of Moelis and Houlihan said they had no comment, and outreach to Jeld-Wen, Gibson Dunn, Davis Polk and Evercore went unanswered.

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The Backdrop: Softer Demand, Tighter Money

Jeld-Wen is navigating the same mix many indebted manufacturers are facing: a cooling construction market and higher interest costs. In the second quarter, revenue slipped 0.7% year over year to $817.8 million, and the company posted a net loss of $31.5 million.

"Overall market volumes remain soft, but the pace of the year-over-year decline is beginning to moderate," Chief Executive Officer William J. Christensen said in August. As of the second quarter, the company listed total debt of $1.25 billion.

Debt Prices and What Investors Are Watching

Per Trace, the $400 million unsecured due December 2027 changed hands near 90 cents over the past week, rising from 61.5 cents on April 2. The $374 million term loan was recently quoted near 87 cents, compared with 75.25 cents on April 6, Bloomberg data show.

On refinancing priorities, Christensen said the firm's "objective is to preserve liquidity, maintain financial flexibility, and provide the company with sufficient time to continue improving performance as market conditions stabilize." For anyone tracking the credits, the pivotal questions are how much time and liquidity the company can buy and how creditor ranks shift if a deal gets done.

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