“We appreciate the support GSO Capital Partners continues to provide us, this time in the form of additional term loans,” said Keith Forman, President and CEO of Rentech. “The task at hand remains clear - to complete the construction and commissioning of, and to place into service, our new pellet facilities in Canada. This will be done in as timely and safe a manner as possible to preserve profitability for our investors. At the same time, we will continue our focus on operating our fertilizer assets profitably, safely and efficiently. We will work to simplify our capital structure and add to our liquidity in the future. Our focus on cost containment is an ongoing process and will continue to evolve, as indeed our company will evolve, over the next year.”
The new lending commitment, in the form of a two-tranche delayed draw term loan, will be available for up to one year. One tranche of the term loan allows Rentech to borrow up to $45 million, of which Rentech has initially borrowed $25 million. The company expects the $45 million tranche to fund construction, working capital and other costs of the Atikokan and Wawa pellet projects until they generate positive cash flow. Rentech may utilize the remaining commitment, of up to $18 million, in the event of certain unplanned downtime at the East Dubuque facility, or unfavorable changes in commodity prices that affect cash distributions from Rentech Nitrogen Partners.
The term loans mature on April 9, 2019. The loans are secured by, among other things, a fixed number of units of Rentech Nitrogen owned by Rentech as well as certain other assets of Rentech and its subsidiaries.
Rentech, Inc. owns and operates wood fibre processing, wood pellet production and nitrogen fertilizer manufacturing businesses.