Ferguson Enterprises Enters $1.6B Credit Facilities for FloWorks Acquisition

What Happened

• On August 11, 2026, Ferguson Enterprises Inc. entered into two unsecured credit agreements — a Bridge Credit Agreement (up to $700 million) and a Term Loan Credit Agreement (up to $900 million) — with lenders led by JPMorgan Chase Bank, N.A. as administrative agent. The facilities are intended to fund a portion of the previously disclosed acquisition of FWI Holdings, Inc. (the “FloWorks Acquisition”) and are subject to customary closing conditions, including the substantially concurrent consummation of the acquisition. The bridge loan matures 364 days after its funding date; the term loan matures three years after its funding date.

Key Details

• Total potential commitments: $700M (bridge) + $900M (term loan) = up to $1.6B.
• Interest: borrower may choose Base Rate or Term SOFR plus margins; margins range from 0.00%–0.25% (Base Rate loans) and 0.75%–1.25% (Term Benchmark loans), depending on Ferguson’s unsecured debt rating.
• Commitment fees: 0.07%–0.125% on unused commitments during specified periods if commitments remain outstanding.
• Covenants: unsecured facilities include customary reps/covenants and require a maximum consolidated net leverage ratio of 3.50x, with a temporary step-up to 4.00x for each of the four fiscal quarters immediately following certain material acquisitions. Ferguson UK Holdings Limited is a guarantor.

Why It Matters

• These facilities provide near-term and medium-term liquidity to ensure the company can complete the FloWorks Acquisition if other financing or capital markets proceeds are not available before or at closing. For investors, the agreements increase potential indebtedness (up to $1.6B) and include leverage covenants that could affect financial flexibility. The temporary covenant step-up offers some breathing room after acquisitions, but unused commitments could also cost the company modest fees if drawn later.