R3 Treatment seeks $165 million credit facility for acquisitions

By Sara Rosenberg

New York, May 10 - R3 Treatment Inc. is in market with a $165 million credit facility, according to a market source.

UBS and Macquarie are the joint bookrunners and lead arrangers on the deal, with UBS the left lead, and Comerica is acting as a lead arranger as well.

The facility consists of a $40 million four-year revolver talked at Libor plus 450 basis points and a $125 million five-year term loan talked at Libor plus 500 bps, with both tranches carrying a 2% Libor floor, the source said.

In addition, pricing on both tranches will be grid based.

Proceeds from the credit facility, which launched with a bank meeting last Thursday, will be used for acquisitions, as four companies are being rolled up to create R3 Treatment.

R3 Treatment is an independent provider of environmentally-conscious waste services for energy and industrial wastes.

On a consolidated basis in 2009, R3 Treatment generated pro forma revenue of $94.9 million, EBITDA of $48.7 million and EBITDA margins of 51.3%.

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