Synagro Technologies has reached an agreement with its key stakeholders to pursue its proposed sale agreement with EQT Infrastructure II through a comprehensive plan of reorganization. EQT Infrastructure II in April agreed to purchase Synagro through a sale under Section 363 of the U.S. Bankruptcy Code.
Synagro Technologies, Inc. today announced that it has reached an agreement with its key stakeholders to pursue its proposed sale agreement with EQT Infrastructure II through a comprehensive Plan of Reorganization.
“This agreement is a significant milestone for the Company and all of our customers, vendors and employees. We now have a more certain timeline and a more efficient means of achieving the same end result as we move ahead in restructuring our debt. A reorganized Synagro with significantly reduced leverage is a powerful change for the Company, as it has been burdened by heavy leverage for many years. Our operations are strong and the conversion to a Plan will make it easier for our customers, vendors and the Company to continue to operate as normal through completion of the transaction later this summer,” said Eric Zimmer, Synagro’s President and CEO.
The Company filed the proposed Plan of Reorganization and the related Disclosure Statement on July 3.
EQT Infrastructure II, the second fund within the infrastructure investment strategy of EQT, in April agreed to purchase Synagro through a sale under Section 363 of the U.S. Bankruptcy Code. By changing the transaction to a sale through a Plan of Reorganization, the Company will be able to accomplish its restructuring efforts and close the transaction with EQT in a timely manner without requiring assignment or other changes to its customer, vendor and other contractual relationships.
“By shifting to this more efficient process, the sale will be even more seamless for our customers and partners, as there will be no change to our contractual relationships,” Joe Page, Synagro’s General Counsel said. “As important, all trade vendors will still be paid in full for pre-petition amounts owed shortly after the sale closes.”
The proposed Plan of Reorganization will include Synagro’s special purpose entities, which include its facilities in Philadelphia, Baltimore, and Sacramento, though these entities will continue to remain outside the Chapter 11 filing process.
EQT is the leading private equity group in Northern Europe with over EUR 20 billion in raised capital and multiple investment strategies. EQT implements its investment strategy by acquiring or financing high-quality, medium-sized to large companies in the United States, Northern and Eastern Europe, and Asia, developing them into leading companies. EQT Infrastructure II closed in January 2013 with EUR 1.925 billion of commitments available for investments.
As previously announced, Synagro on April 24 initiated a Chapter 11 restructuring in order to complete the sale and refinance the Company’s debt. The Company’s operations have continued as normal throughout this process, supporting more than 600 customers across the country, each of which relies on Synagro’s industry-leading biosolids management solutions to support their daily operations.
Synagro is being advised by the law firm of Skadden Arps Slate Meagher & Flom, along with financial adviser AlixPartners and investment bankers Evercore Partners.
Founded in 1986, Synagro provides a system of solutions for civic and commercial organizations that manages by-products to create new, environmentally compelling options. The Company’s reliable, lasting system transforms industrial and municipal waste into environmentally sustainable resources that benefit our communities and our planet—before an environmental footprint is left behind. As the largest recycler of organic by-products in the United States, Synagro uses best-in-class processes from beneficial reuse to renewable energy that adhere to the strictest of environmental regulations to provide sustainable solutions for communities across the nation. Serving more than 600 municipal and industrial water and wastewater facilities throughout the U.S., the Company’s leading systems of by-product management services help municipalities of all sizes save money and meet environmental regulations.
SOURCE Synagro Technologies, Inc.