Calgon Carbon Corporation (CCC - Analyst Report) recently announced that it has closed a new $400 million syndicated credit facility. The facility was initially utilized to refinance existing debt under the company’s earlier credit facility through the issuance of a 7-year $100 million term loan.
The facilities consist of a $300 million unsecured 5-year revolving loan and a $100 million 7-year unsecured term loan. The $300 million 5-year revolving credit facility is expected to provide funding for the roughly $151.5 million cash purchase price of the company’s pending buyout of CECA’s wood-based activated carbon and filter aid business, which is anticipated to occur later in fourth-quarter 2016. The new credit facility will also be utilized for working capital requirements and general corporate purposes.
The credit facility was led by PNC Capital Markets LLC and Citizens Bank, N.A. as joint lead arrangers and PNC Bank as administrative agent. It also includes Bank of America, N.A. and Branch Banking & Trust Company as co-documentation agents. Participants include First National Bank of Pennsylvania, The Huntington National Bank, ING Bank N.V., Dublin Branch, First Commonwealth Bank and Northwest Bank.
Shares of the company rose 2.8% to close at $16.14 on Oct 5.
Calgon Carbon, which is among the prominent pollution control companies along with Casella Waste Systems Inc. (CWST - Snapshot Report) , Energy Recovery, Inc. (ERII - Snapshot Report) and CECO Environmental Corp. (CECE - Snapshot Report) , ended second-quarter 2016 with cash and cash equivalents of $51.2 million, up from $50.1 million as of Jun 30, 2015. Long-term debt was $101.6 million as of Jun 30, 2016, up from $87.3 million as of Jun 30, 2015.
During the second quarter, Calgon Carbon declared the establishment of an additional cost-improvement program that is expected to generate savings of more than $10 million, most of which are projected to be realized in 2017. This brings the total targeted annual cost and efficiency improvements from the inception of the company’s cost-improvement program that commenced in 2012, to over $60 million.
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