Progress Software Announces Amended Credit Facility, Boosts Revolving Credit to $1.5B, Extends Maturity Date to 2030

Progress Software has announced an amended credit facility of $1.5 billion, replacing its existing secured credit facility of $900 million. The new facility extends the maturity date to July 31, 2030, and provides greater scale and flexibility to support the company's continued growth. The increased liquidity will enable Progress to deliver on its Total Growth Strategy through additional accretive acquisitions.

Progress Software (Nasdaq: PRGS), a leading provider of AI-powered digital experience and infrastructure software, has announced an amended credit facility worth $1.5 billion. This facility replaces the company's existing secured credit facility of $900 million and extends the maturity date to July 31, 2030. The new credit agreement, which includes a $660 million revolving credit loan outstanding, aims to provide the company with greater scale and flexibility to support its continued growth.

The company's Chief Financial Officer, Anthony Folger, stated, "This new credit facility provides the scale and flexibility needed to support Progress' continued growth. With our increased liquidity, Progress is exceptionally well positioned to deliver on our Total Growth Strategy through additional accretive acquisitions." [1]

The amended credit facility was arranged by JPMorgan Chase Bank, N.A., Citibank, N.A., Wells Fargo Bank, N.A., Bank of America, N.A., PNC Bank, National Association, TD Bank, N.A., Citizens Bank N.A., and First-Citizens Bank & Trust Company. JPMorgan Chase Bank, N.A., Citibank, N.A., and Wells Fargo Securities, LLC acted as Joint Bookrunners and Joint Lead Arrangers, while BofA Securities, Inc., PNC Bank, National Association, and TD Bank, N.A. served as Joint Lead Arrangers. [1]

The increased liquidity comes at a time when Progress Software has been performing well financially. Oppenheimer analyst Ittai Kidron recently upgraded Progress Software to a Buy rating, setting a price target of $70.00. This rating was based on the company's strong second-quarter financial performance, which exceeded market expectations. Progress Software reported a 36% increase in total revenue year-over-year, reaching $237 million, and a 46% growth in Annual Recurring Revenue (ARR) to $838 million. The company also achieved a 100% net retention rate and maintained a 40% operating margin. [2]

Despite the positive outlook, Oppenheimer acknowledged some challenges. Free cash flow for the quarter was below expectations due to timing issues and the transition of ShareFile onto Progress's billing system. Additionally, the company's debt remains high, with a total debt of $1.47 billion and a net debt position of $1.37 billion. However, Oppenheimer believes that Progress Software is well-positioned to handle these challenges and expects the company to continue its strong performance in the coming quarters. [2]

References:
[1] https://www.marketscreener.com/news/progress-software-announces-amended-credit-facility-ce7c5cdcd188f222
[2] https://www.ainvest.com/news/progress-software-receives-buy-rating-oppenheimer-2507/