Enviva secures funds to complete pellet mills
November 15, 2012, Washington, DC – Enviva announced that it has secured $120 million to complete the construction of two new pellet mills in Virginia an North Carolina.
November 15, 2012 By John Tenpenny
"This substantial commitment by the Joint Lead Arrangers and the other financing banks is an important step in right-sizing Enviva's balance sheet," said Steve Reeves, the company's executive Vice President and Chief Financial Officer. "As one of the first credit underwritings of its kind in the emerging biomass renewable energy sector, we're delighted by the strong show of confidence from leaders in the banking industry."
Enviva closed on a $120 million Senior Secured Credit Facility, the company's first corporate borrowing. Barclays Bank PLC, Goldman Sachs Bank USA and Royal Bank of Canada served as Joint Lead Arrangers and Joint Book Runners.
The proceeds of the debt offering will be used to complete the construction of two new 500,000 metric ton per year pellet mills, one each in Virginia and North Carolina, and to increase the storage capacity of Enviva's deep-water port terminal in Chesapeake, Virginia to approximately 100,000 metric tons. This construction and expansion will complement Enviva's existing manufacturing base and large operating footprint in the mid-Atlantic, Mississippi and Alabama.
When complete in 2013, Enviva's 1.72 million tons of combined annual capacity will help fulfill existing long-term supply agreements for the company's solid renewable fuels to major European utility customers.
"As demand for sustainable biomass fuels continues to increase worldwide, the midstream supply sector must continue to grow alongside, aggregating and processing fragmented wood resources into high-quality renewable fuels and storing, terminaling and delivering them reliably to our customers," said John Keppler, chairman and CEO of Enviva.
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