Liberty Tire Recycling Holdco, LLC and its subsidiaries have entered into a privately negotiated agreement with holders of more than 96 per cent of the Company’s Second Lien Secured Notes and 80 per cent of the Company’s common equity designed to substantially deleverage the company’s balance sheet, reduce interest expense, and better position the company to capitalise on attractive organic and inorganic growth opportunities.
New Financial Changes Explained
In connection with this transaction, the company expects that Carlyle Strategic Partners, an investment fund managed by The Carlyle Group, will become the company’s majority equity sponsor and will partner with Liberty to provide additional strategic resources to support the company’s continued success. The Transaction contemplates:
- A refinancing of the company’s existing Term Loan which will reduce interest expenses and extend the maturity date.
- An exchange offer, launched yesterday, for all of the company’s Second Lien Senior Secured Notes, which the company expects will substantially reduce the principal amount and interest rate, and extend the maturity of its notes.
“We believe these transactions will provide Liberty with increased financial flexibility to execute on our strategic growth plans and position the company to continue to provide our customers with industry-leading service levels,” said Thomas Womble, chief executive officer. “We greatly appreciate the continued support of our valued customers, suppliers, and partners who are critical to our success now and in the future. I also want to thank our extraordinary employees, who have been vital to our success in continuing to be the premier provider of tyre recycling services in North America. We look forward to enhancing our relationships and many more years of continued partnership and success with all our important stakeholders.”
Ron Carlson, chief financial officer, said: “We expect that these transactions will allow us to continue to make significant capital investments in our plants and equipment, capitalise on new market opportunities, negotiate better vendor terms, and significantly grow the business both organically and through acquisitions.”
These transactions are subject to a number of terms and conditions and are expected to be completed by the end of the year, however there can be no assurances they will be completed or completed on the terms described in this release.