Financing Arrangements

12 Months Ended

Dec. 31, 2019

Short-term debt as of December 31, 2019 and 2018 was as follows:



	2019		2018
Variable-rate Accounts Receivable Facility with an interest rate of 2.77% at December 31, 2019	$	1.8	$	—
Borrowings under lines of credit for certain of the Company’s foreign subsidiaries with various banks with interest rates ranging from 0.27% to 1.75% at December 31, 2019 and 0.29% to 1.00% at December 31, 2018	15.5		33.6
Short-term debt	$	17.3	$	33.6

The Company has a $100 million Accounts Receivable Facility, which matures November 30, 2021. Under the terms of the Accounts Receivable Facility, the Company sells, on an ongoing basis, certain domestic trade receivables to Timken Receivables Corporation, a wholly owned consolidated subsidiary that, in turn, uses the trade receivables to secure borrowings that are funded through a vehicle that issues commercial paper in the short-term market. Borrowings under the Accounts Receivable Facility may be limited to certain borrowing base limitations; however, availability under the Accounts Receivable Facility was not reduced by any such borrowing base limitations at December 31, 2019. As of December 31, 2019, there were outstanding borrowings of $100.0 million under the Accounts Receivable Facility, which reduced the availability under this facility to zero. $1.8 million of the outstanding borrowings under the Accounts Receivable Facility was classified as short-term and reflects the Company's expectations over the next 12 months relative to the minimum borrowing base. The cost of this facility, which is the prevailing commercial paper rate plus facility fees, is considered a financing cost and is included in interest expense in the Consolidated Statements of Income. The yield rate was 2.77%, 3.22% and 2.15% at December 31, 2019, 2018 and 2017, respectively.

The lines of credit for certain of the Company’s foreign subsidiaries provide for short-term borrowings up to $268.9 million in the aggregate. Most of these lines of credit are uncommitted. At December 31, 2019, the Company’s foreign subsidiaries had borrowings outstanding of $15.5 million and guarantees of $0.5 million, which reduced the aggregate availability under these facilities to $252.9 million. The weighted-average interest rate on these lines of credit during the year were 0.5%, 0.6% and 0.7% in 2019, 2018 and 2017, respectively. The decrease in the weighted-average interest rate was primarily due to a decrease in borrowing rates in Europe. The weighted-average interest rate on lines of credit outstanding at December 31, 2019 and 2018 was 1.03% and 0.33%, respectively.

Long-term debt as of December 31, 2019 and 2018 was as follows:

	2019		2018
Variable-rate Senior Credit Facility with an average interest rate on U.S. Dollar of 2.85% and Euro of 1.00% at December 31, 2019 and 3.40% and 1.10%, respectively, at December 31, 2018	$	132.7	$	43.9
Variable-rate Euro Term Loan⁽¹⁾, maturing on September 18, 2020, with an interest rate of 1.13% at December 31, 2019 and December 31, 2018	54.4		107.1
Variable-rate Accounts Receivable Facility, with an interest rate of 2.77% at December 31, 2019 and 3.22% at December 31, 2018	98.2		75.0
Variable-rate Term Loan⁽¹⁾, maturing on September 11, 2023, with an interest rate of 2.92% at December 31, 2019 and 3.77% at December 31, 2018	338.5		347.1
Fixed-rate Senior Unsecured Notes⁽¹⁾, maturing on September 1, 2024, with an interest rate of 3.875%	348.5		347.7
Fixed-rate Euro Senior Unsecured Notes⁽¹⁾, maturing on September 7, 2027, with an interest rate of 2.02%	167.7		171.4
Fixed-rate Senior Unsecured Notes⁽¹⁾, maturing on December 15, 2028, with an interest rate of 4.50%	396.1		395.8
Fixed-rate Medium-Term Notes, Series A⁽¹⁾, maturing at various dates through May 2028, with interest rates ranging from 6.74% to 7.76%	154.6		154.6
Fixed-rate Bank Loan, maturing on June 30, 2033, with an interest rate of 2.15% at December 31, 2019.	18.0		—
Other	4.1		5.4
Total debt	$	1,712.8	$	1,648.0
Less current maturities	64.7		9.4
Long-term debt	$	1,648.1	$	1,638.6

⁽¹⁾ Net of discount and fees

On June 25, 2019, the Company entered into the Senior Credit Facility. The Senior Credit Facility amends and restates the Company's previous credit agreement, dated as of June 19, 2015. The Senior Credit Facility is a $650.0 million unsecured revolving credit facility, which matures on June 25, 2024. At December 31, 2019, the Company had $132.7 million of outstanding borrowings under the Senior Credit Facility, which reduced the availability under this facility to $517.3 million. The Senior Credit Facility has two financial covenants: a consolidated leverage ratio and a consolidated interest coverage ratio.

On November 1, 2019, the Company assumed certain fixed-rate debt of €16 million associated with the BEKA acquisition that matures on June 30, 2033.

On September 6, 2018, the Company issued $400 million aggregate principal amount of the 2028 Notes. On September 11, 2018, the Company entered into the $350 million 2023 Term Loan. Proceeds from the 2028 Notes and the 2023 Term Loan were used to fund the acquisitions of Cone Drive and Rollon, which closed on September 1, 2018 and September 18, 2018, respectively. Refer to Note 2 - Acquisitions and Divestitures for additional information.

The Company expects to service interest and repay the remaining principal balance of $54.4 million for the 2020 Term Loan with cash held or generated outside the U.S.

At December 31, 2019, the Company was in full compliance with all applicable covenants on its outstanding debt.

The maturities of long-term debt (including $3.4 million of finance leases) for the five years subsequent to December 31, 2019 are as follows:



Year
2020	$	64.7
2021	110.2
2022	10.6
2023	313.6
2024	483.7
Thereafter	730.0

Interest paid was $67.4 million in 2019, $42.5 million in 2018 and $31.5 million in 2017. This differs from interest expense due to the timing of payments, the amortization of deferred financing fees and interest capitalized of $1.1 million in 2019, $0.4 million in 2018 and $0.7 million in 2017.