AgroFresh Solutions (AGFS): Refinancing Comprised Of $150 Million Convertible Preferred Equity Investment Closed

By Noah Long ● July 27, 2020
  • AgroFresh Solutions Inc (NASDAQ: AGFS) — a leader in produce freshness solutions — announced the successful closing of its comprehensive refinancing comprised of the previously-announced $150 million convertible preferred equity investment

AgroFresh Solutions Inc (NASDAQ: AGFS) — a leader in produce freshness solutions — announced the successful closing of its comprehensive refinancing comprised of the previously-announced $150 million convertible preferred equity investment by an affiliate of Paine Schwartz Partners, LLC. And the amendment and extension of the Company’s senior secured credit facilities. For over 20 years, AgroFresh has been transforming the apple industry and it has launched new innovative solutions in a variety of fresh produce categories ranging from bananas to cherries and citrus to pears. Plus AgroFresh supports growers, packers and retailers by supplying post-harvest solutions across the industry that enhance crop values while conserving our planet’s resources and reducing global food waste.

AgroFresh had entered into a revised credit agreement where the company’s term loan maturity has been extended to December 31, 2024. And with the proceeds of the PSP convertible preferred equity investment, the principal outstanding on AgroFresh’s term loan was been reduced to $275 million thus resulting in a decline in the company’s net debt-to-adjusted EBITDA ratio from approximately 5.8x to 3.9x on a pro-forma basis for the twelve months ended March 31, 2020.

The company’s revolving credit facility has been doubled in size from $12.5 million to $25.0 million with its maturity extended to June 30, 2024. And borrowings under the amended term loan will bear interest at the rate of LIBOR plus 6.25% with a 1% LIBOR floor.

“We are pleased to close on this comprehensive refinancing and are grateful for the support from both existing and new lenders during this process. The transaction accomplishes several key goals for the business, including the significant immediate deleveraging of our balance sheet and an extension of our maturities. Further, the new optimized capital structure allows us the flexibility to more aggressively address our diversification initiatives and generate growth with the support of our new strategic equity investor Paine Schwartz,” said AgroFresh Chief Financial Officer Graham Miao.

BMO Capital Markets had acted as sole financial advisor to AgroFresh and left-lead bookrunner on the amendment and extension of AgroFresh’s senior secured credit facilities. Deutsche Bank and ING acted as joint lead arrangers and joint bookrunners.

Greenberg Traurig, LLP served as legal advisor to AgroFresh. And Evercore and Kirkland & Ellis, LLP were the financial and legal advisors to Paine Schwartz, respectively. White & Case, LLP served as the lenders’ counsel.