ESAB CorpESAB
ESAB Corp Debt Disclosure
Debt
The table below shows the components of the Company’s debt.
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| (In thousands) | |||||||||||
| Term loan | $ | 350,000 | $ | 385,000 | |||||||
| Senior unsecured notes | 700,000 | 700,000 | |||||||||
| Revolving credit facility | 185,000 | — | |||||||||
| Other debt | 8,215 | — | |||||||||
| Total debt | 1,243,215 | 1,085,000 | |||||||||
| Current portion of debt | (2,412) | (15,000) | |||||||||
| Unamortized deferred financing fees | (8,263) | (9,261) | |||||||||
| Long-term debt | $ | 1,232,540 | $ | 1,060,739 | |||||||
Senior Notes, Term Loan and Revolving Credit Facility
On April 4, 2022, the Company entered into a credit agreement that initially consisted of (i) a $750 million revolving credit facility with a maturity date of April 4, 2027, (ii) a senior term loan A-1 facility with an initial aggregate principal amount of $400 million, with a maturity date of April 4, 2027 and (iii) a $600 million 364-day senior term loan A-2 facility with a maturity date of April 3, 2023. The senior term loan A-2 facility was subsequently refinanced in June 2022 extending its maturity date to April 3, 2025 to become senior term loan A-3 facility.
On April 9, 2024, the Company issued $700 million in aggregate principal amount of 6.25% senior notes due 2029 (the “Senior Notes”) governed by an indenture (the “Indenture”). The Senior Notes have a contractual maturity interest rate of 6.25% and maturity date of April 15, 2029. The Company used the net proceeds from the Senior Notes to pay off its senior term loan A-3 facility and pay fees associated with the offering.
On October 16, 2025, the Company entered into an Amended and Restated Credit Agreement (the “A&R Credit Agreement”) that, among other things, provides for (i) a senior term loan A facility (the “Term Loan A Facility”) in an
aggregate principal amount of $350 million, and (ii) a senior revolving credit facility (the “Revolving Facility”) in the amount of $1.05 billion to replace the Company’s existing $400 million senior term loan A-1 facility and $750 million revolving credit facility and pay off the outstanding principal and interest thereunder. Both facilities mature on October 16, 2030, subject to a springing maturity date under certain circumstances. The Revolving Facility contains a $300 million foreign currency sublimit and a $50 million swing line loan sub-facility.
As of December 31, 2025, the A&R Credit Agreement and the Indenture consist of the following facilities:
•A $1.05 billion Revolving Facility with a maturity date of October 16, 2030, with $185 million drawn;
•A Term Loan A Facility with an aggregate principal amount of $350 million, with maturity dates through October 16, 2030; and
•Senior Notes with an aggregate principal amount of $700 million with a maturity date of April 15, 2029.
The A&R Credit Agreement and the Indenture contain customary covenants. These covenants limit the ability of the Company and its subsidiaries to, among other things, incur debt or liens, merge or consolidate with others, dispose of assets, make investments or pay dividends. In addition, the A&R Credit Agreement requires that the Company maintains certain financial covenants and the Company was in compliance with all of its debt covenants as of December 31, 2025. The A&R Credit Agreement and the Indenture contain various events of default (including failure to comply with the covenants under the A&R Credit Agreement and related agreements) and upon an event of default the lenders may, subject to various customary cure rights, require the immediate payment of all amounts outstanding under the Term Loan A Facility, Senior Notes and the Revolving Facility. Certain United States subsidiaries of the Company have agreed to guarantee the obligations of the Company under the A&R Credit Agreement and the Senior Notes.
Loans made under the Term Loan A Facility will bear interest, at the election of the Company, at either the base rate (as defined in the A&R Credit Agreement) or at the term Secured Overnight Financing Rate (“SOFR”) plus an adjustment (as defined in the A&R Credit Agreement), in each case, plus the applicable interest rate margin. Loans made under the Revolving Facility will bear interest, at the election of the Company, at either the base rate or, (i) in the case of loans denominated in Dollars, the term SOFR plus an adjustment or the daily simple SOFR plus an adjustment, (ii) in the case of loans denominated in Euros, the adjusted Euro Interbank Offered Rate (“EURIBOR”) and, (iii) in the case of loans denominated in Sterling, Sterling Overnight Index Average (“SONIA”) plus an adjustment (as all such rates are defined in the A&R Credit Agreement), in each case, plus the applicable interest rate margin. The applicable interest rate margin changes based upon the Company’s total leverage ratio (ranging from 1.125% to 1.750% or in the case of the base rate margin, 0.125% to 0.750%). Each swing line loan denominated in dollars will bear interest at the base rate plus the applicable interest rate margin.
To manage exposures to currency exchange rates and interest rates arising in Long-term debt, the Company has interest rate swap agreements. Refer to Note 16, “Derivatives” for additional information.
As of December 31, 2025, the weighted-average interest rate of borrowings under the A&R Credit Agreement and the Indenture was 5.40%, excluding accretion of deferred financing fees. There was approximately $865 million of borrowing capacity available on the Revolving Facility, subject to the Company meeting financial covenants and other requirements.
As of December 31, 2025, the weighted-average interest rate of borrowings under the A&R Credit Agreement and the Indenture was 5.40%, excluding accretion of deferred financing fees. There was approximately $865 million of borrowing capacity available on the Revolving Facility, subject to the Company meeting financial covenants and other requirements.
Other Indebtedness
In addition to the debt agreements discussed above, the Company also has the ability to incur approximately $50 million of indebtedness pursuant to certain uncommitted credit lines, consisting of an uncommitted credit line that the Company has used from time to time in the past for short-term working capital needs.
The Company is party to letter of credit facilities with an aggregate capacity of $113.3 million. Total letters of credit of $33.7 million were outstanding as of December 31, 2025.
Deferred Financing Fees
The Company had total deferred financing fees of $12.5 million included in its Consolidated Balance Sheets as of December 31, 2025, which will be charged to Interest expense and other, net, over the term of the related debt instruments. The costs associated with the Term Loan A Facility and Senior Notes noted above will be amortized over the contractual term of the related facility. Of the $12.5 million, $4.2 million of deferred financing fees relating to the Revolving Facility are included in Other assets and $8.3 million of deferred financing fees relating to the Term Loan A Facility and Senior Notes are recorded as a contra-liability within Long-term debt.
Other
The Company’s minimum principal payments for the next five years are broken out in the table below.
December 31, 2025 | |||||
| (In thousands) | |||||
| 2026 | $ | 2,412 | |||
| 2027 | 10,408 | ||||
| 2028 | 10,408 | ||||
| 2029 | 719,158 | ||||
| 2030 | 500,829 | ||||
Total debt(1) | $ | 1,243,215 | |||
(1)Total debt excludes $8.3 million of related unamortized deferred financing fees.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 20, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 29, 2024 | |
| 2022 | Mar 7, 2023 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.