Casella Waste Systems Inc., a regional solid waste, recycling and resource management services company headquartered in Rutland, Vermont, has entered into a $550 million credit facility with Bank of America N.A. as administrative agent and swing line lender; Merrill Lynch, Pierce Fener & Smith Inc., Citizens Bank N.A., JPMorgan Chase Bank N.A. and Comerica Bank as joint lead arrangers and joint bookrunners; and certain other agents and lenders.
The credit facility provides for a term loan A facility of $350 million and a revolving credit facility in the principal amount of up to $200 million, with a $60 million sublimit for letters of credit, the company says. The interest rate margin applicable to LIBOR (London Interbank Offered Rate) borrowings has been reduced to a range of 1.25 percent to 2.25 percent from the current range of 2.75 percent to 3 percent in the case of term loans based on consolidated net leverage ratio. In the case of revolving loans, the interest rate margin now ranges from 1.25 percent to 2.25 percent, down from the previous range of 2.50 percent to 3.25 percent based on consolidated net leverage ratio.
The credit facility matures May 14, 2023, and replaces Casella’s prior $510 million credit facility. The company says it expects the total cost of this transaction to be $4 million. Total annual interest savings are expected to be approximately $2 million initially.
Additional information on the credit agreement will be included in a current report on Form 8-K to be filed with the Securities and Exchange Commission, Casella adds.