Archaea Energy Inc., has successfully closed the previously announced amendment to its Revolving Credit and Term Loan Agreement. Aggregate commitments now total $1.1 billion, an increase of approximately $630 million from the original facilities, including a $400 million senior secured term loan credit facility and a $700 million senior secured revolving credit facility (together, the “Amended Facilities”). The interest rate for the Amended Facilities remains unchanged at the secured overnight financing rate (“SOFR”) plus 275 basis points for the revolving credit facility and SOFR plus 325 basis points for the term loan credit facility. The maturity date of the Amended Facilities remains unchanged at September 15, 2026.
Available capacity under the Amended Facilities is expected to be used to fund (a) the Company’s previously announced acquisition of NextGen Power Holdings LLC (together with its subsidiaries, “INGENCO”), which is expected to close on or after July 1, 2022, and other Permitted Acquisitions as defined thereunder, (b) capital expenditures related to the Company’s previously announced Lightning Renewables joint venture with Republic Services Inc., and other Permitted Investments as defined thereunder, (c) other capital expenditures within the Company’s development plan, (d) expenses related to the Amended Facilities, and (e) to provide working capital and for other general corporate purposes.
The Amended Facilities, along with the Company’s other existing sources of liquidity, are expected to be sufficient to fund the Company’s acquisition of INGECO and development capital needs, including capital expenditures related to projects within the Company’s Lightning Renewables joint venture with Republic Services, Inc., projects related to INGENCO, and core development projects, for the foreseeable future, thereby eliminating the need for additional external capital in the near-term based on the Company’s current development plans and backlog.
“The successful amendment and upsize of our bank facilities is a momentous achievement for Archaea, one that puts us in a strong position to successfully execute on the robust project backlog we have worked diligently to develop over the past year,” said Nick Stork, Archaea's Co-Founder and Chief Executive Officer. “The strong support from our lender group, as evidenced by the over $600 million incremental commitments under the Amended Facilities, demonstrates confidence in our differentiated business model and ability to execute on our project backlog at industry-leading speed and cost due to our technology-driven approach and gas processing expertise. The Archaea team today is more unified than ever in our commitment, passion, and excitement for achieving our development goals, and we look forward to seeing the meaningful decarbonization impact our RNG facilities will bring to our stakeholders including partners, customers and local communities.”