Shaw Group Extends Credit Facility to October 2012

Engineering and construction company Shaw Group Inc. said Friday it extended a $1 billion credit line to October 2012 by pledging its tangible and intangible assets.

The credit agreement also lets Shaw to seek additional secured commitments of up to $400 million under this facility and other supplemental credit facilities.

Further, Shaw may pledge up to $300 million of its unrestricted cash to secure additional letters of credit.

"The agreement is secured by a first priority security interest in all of Shaw's tangible and intangible assets, a pledge of all of the capital stock of the companys material domestic subsidiaries, guarantees by the company's material domestic subsidiaries and a pledge of 66 percent of the capital stock of certain of the company's foreign subsidiaries," the company said in a news release.

The credit agreement will become unsecured once Standard & Poor's and Moody's rating services designate the facility as investment grade.

Shares fell 9 cents to $30.51 Friday.

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