Power Solutions International Enters $220M Revolving Credit Facility

What Happened
Power Solutions International, Inc. (PSI) announced it entered into a Revolving Credit Agreement dated September 25, 2026, providing up to $220.0 million in committed borrowing capacity with HSBC Bank USA as administrative agent. The facility matures on September 25, 2029. PSI drew $35.0 million at closing and used part of the proceeds to repay its prior credit agreement.

Key Details

• Total facility: $220.0 million committed, including a $70.0 million sublimit for letters of credit.
• Interest and fees: borrowings at Term SOFR + 1.80% per year (or an alternate base rate + margin); commitment fee 0.20% on unused commitments; letter-of-credit fees 1.80% on outstanding L/C amounts.
• Security and guarantees: obligations guaranteed by PSI’s subsidiaries (Bi-Phase Technologies, Power Great Lakes, Powertrain Integration Acquisition, Professional Power Products, PSI International, MTL Manufacturing & Equipment, and The W Group) and secured by substantially all personal property, pledged equity interests and IP (patent and trademark security agreements). An intercompany subordination agreement subordinates intra-group indebtedness to this facility.
• Financial covenants and events: quarterly tests require a consolidated interest coverage ratio ≥ 3.00x and a consolidated leverage ratio ≤ 3.00x; customary affirmative/negative covenants and default events (including change of control). Change-of-control is defined by Weichai’s ownership falling to 50% or less, with an exception so long as Weichai America can appoint a majority of the board and Weichai holds at least 40% of equity. Initial lenders include HSBC, ANZ, Bank of China (Chicago), and BNP Paribas.

Why It Matters
This new $220M revolver provides PSI with near-term liquidity for working capital and general corporate purposes and replaces the prior credit facility. The secured nature of the loans and the financial covenants mean PSI must maintain specified leverage and coverage levels and may face limits on certain transactions (e.g., additional debt, dividends or affiliate deals) if covenant tests are not met. Investors should note the borrowing cost, the initial $35M draw, the collateral and guarantees, and the change-of-control language tied to major shareholder Weichai, which can affect covenant and default considerations.