Pzena Investment amends credit pact with lenders
(Reuters) - U.S. money manager Pzena Investment Management (PZN.N) said it reached an agreement with lenders to amend the terms of a credit facility including the waiver of a financial covenant requiring it to maintain a minimum level of assets under management.
Pzena shares rose as much as 12 percent in early trade but pared some of its gains and was trading up more than 5 percent.
The company, which was founded by value investor Richard Pzena in 1995, said the amendment required repayment of $25 million of outstanding debt which it plans to partially fund through issuance of $16 million senior subordinated notes .
In a regulatory filing, Pzena said the amendment also reduced commitments under the credit facility by $1.2 million, but placed certain additional restrictions on the company's ability to make restricted payments, including dividends.
On Wednesday, the company reported a 46 percent fall in assets under management for the third quarter and suspended its quarterly dividend.
The amendment to the credit facility comes at a time when money managers are struggling with falling assets under management due to the ongoing crisis in the financial markets.
Shares of Pzena Investment were trading up 5 percent at $4.30 in morning trade on the New York Stock Exchange. They touched a high of $4.58 earlier in the session.
(Reporting by Sweta Singh in Bangalore, Editing by Dinesh Nair)
