MORRISTOWN, N.J., Aug. 24, 2020 /PRNewswire/ -- Covanta Holding
Corporation (NYSE: CVA) ("Covanta" or the "Company") today
announced that it has entered into a loan agreement with the
National Finance Authority (New
Hampshire) under which they agreed to issue $129.4 million in new tax exempt bonds (the
"Series 2020 bonds") to refinance certain outstanding bonds issued
in 2015. The Series 2020 bonds bear interest at a weighted average
coupon of 3.71% and are subject to mandatory tender for purchase in
2040. The new bonds are unsecured obligations of Covanta Holding
Corporation and are not guaranteed by any of our subsidiaries,
whereas the refunded bonds were guaranteed by our subsidiary,
Covanta Energy LLC. Descriptions of both series of bonds are listed
below.
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The transaction lowers the weighted average coupon on the bonds
by over 145 basis points, and as a result of the removal of our
subsidiary guarantee, also reduces the leverage ratio under our
senior secured credit facilities on a pro forma basis.
"Covanta remains focused on optimizing its capital structure and
this transaction represents another opportunistic action to lower
our cost of debt while maintaining an attractive term structure,"
said Bradford J. Helgeson, Covanta's
CFO. "This transaction, when combined with our recently announced
taxable bond refinancing, results in annual cash interest savings
of over $5 million."
Description of the Series 2020 bonds
- $39,405,000 3.625% National
Finance Authority (New Hampshire)
Resource Recovery Refunding Revenue Bonds (Covanta Project) Series
2020A (Non-AMT) due July 1,
2043;
- $90,000,000 3.75% National
Finance Authority (New Hampshire)
Resource Recovery Refunding Revenue Bonds (Covanta Project) Series
2020B (AMT) (Green Bonds) due
July 1, 2045.
Description of the refunded bonds
- $39,405,000 5.00% Delaware County
Industrial Development Authority Refunding Revenue Bonds (Covanta
Project), Series 2015A due July 1,
2043;
- $90,000,000 5.25% Essex County
Improvement Authority Solid Waste Disposal Revenue Bonds (Covanta
Project) Series 2015 due July 1,
2045.
About Covanta
Covanta is a world leader in providing sustainable waste and
energy solutions. Annually, Covanta's modern Energy-from-Waste
facilities safely convert approximately 21 million tons of waste
from municipalities and businesses into clean, renewable
electricity to power one million homes and recycle 500,000 tons of
metal. Through a vast network of treatment and recycling
facilities, Covanta also provides comprehensive industrial material
management services to companies seeking solutions to some of
today's most complex environmental challenges. For more
information, visit covanta.com.
Cautionary Note Regarding Forward-Looking
Statements
Certain statements in this press release may constitute
"forward-looking" statements as defined in Section 27A of the
Securities Act of 1933, as amended (the "Securities Act"), Section
21E of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), the Private Securities Litigation Reform Act of
1995 (the "PSLRA") or in releases made by the SEC, all as may be
amended from time to time. Such forward-looking statements involve
known and unknown risks, uncertainties and other important factors
that could cause the actual results, performance or achievements of
Covanta and its subsidiaries, or industry results, to differ
materially from any future results, performance or achievements
expressed or implied by such forward-looking statements. Statements
that are not historical fact are forward-looking statements.
Forward-looking statements can be identified by, among other
things, the use of forward- looking language, such as the words
"plan," "believe," "expect," "anticipate," "intend," "estimate,"
"project," "may," "will," "would," "could," "should," "seeks," or
"scheduled to," or other similar words, or the negative of these
terms or other variations of these terms or comparable language, or
by discussion of strategy or intentions. These cautionary
statements are being made pursuant to the Securities Act, the
Exchange Act and the PSLRA with the intention of obtaining the
benefits of the "safe harbor" provisions of such laws. Covanta
cautions investors that any forward-looking statements made by
Covanta are not guarantees or indicative of future performance.
Important assumptions and other important factors that could cause
actual results to differ materially from those forward-looking
statements with respect to Covanta include, but are not limited to,
the risks and uncertainties affecting Covanta's businesses
described in periodic securities filings by Covanta with the SEC.
Important factors, risks and uncertainties that could cause actual
results to differ materially from those forward-looking statements
include, but are not limited to: seasonal or long-term fluctuations
in the prices of energy, waste disposal, scrap metal and
commodities; Covanta's ability to renew or replace expiring
contracts at comparable prices and with other acceptable terms;
adoption of new laws and regulations in the United States and abroad, including energy
laws, environmental laws, tax laws, labor laws and healthcare laws;
failure to maintain historical performance levels at Covanta's
facilities and its ability to retain the rights to operate
facilities it does not own; Covanta's ability to avoid adverse
publicity or reputational damage relating to its business; advances
in technology; difficulties in the operation of its facilities,
including fuel supply and energy delivery interruptions, failure to
obtain regulatory approvals, equipment failures, labor disputes and
work stoppages, and weather interference and catastrophic events;
difficulties in the financing, development and construction of new
projects and expansions, including increased construction costs and
delays; limits of insurance coverage; Covanta's ability to avoid
defaults under its long-term contracts; performance of third
parties under its contracts and such third parties' observance of
laws and regulations; concentration of suppliers and customers;
geographic concentration of facilities; increased competitiveness
in the energy and waste industries; changes in foreign currency
exchange rates; limitations imposed by Covanta's existing
indebtedness and its ability to perform its financial obligations
and guarantees and to refinance its existing indebtedness; exposure
to counterparty credit risk and instability of financial
institutions in connection with financing transactions; the
scalability of its business; restrictions in its certificate of
incorporation and debt documents regarding strategic alternatives;
failures of disclosure controls and procedures and internal
controls over financial reporting; Covanta's ability to attract and
retain talented people; Covanta's ability to utilize net operating
loss carryforwards; general economic conditions in the United States and abroad, including the
availability of credit and debt financing; and other risks and
uncertainties affecting Covanta's businesses described in periodic
securities filings by Covanta with the SEC. Although Covanta
believes that its plans, intentions and expectations reflected in
or suggested by such forward-looking statements are reasonable,
actual results could differ materially from a projection or
assumption in any forward-looking statements. Covanta's future
financial condition and results of operations, as well as any
forward-looking statements, are subject to change and to inherent
risks and uncertainties. The forward-looking statements contained
in this press release are made only as of the date hereof and
Covanta does not have or undertake any obligation to update or
revise any forward-looking statements whether as a result of new
information, subsequent events or otherwise, unless otherwise
required by law.
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SOURCE Covanta Holding Corporation