4.5% convertible preferreds sold to GSO along with variable-rate loan
By Devika Patel
Knoxville, Tenn., April 10 - Rentech, Inc. said it settled a $100 million private placement of 4.5% convertible preferred stock with GSO Capital Partners LP on Wednesday. The investor has also agreed to provide a $50 million term loan.
The preferreds were sold at 98 and are convertible into about 45 million common shares at $2.22 per share, which is a 23.33% premium to the April 8 closing share price of $1.80. The preferreds are optionally redeemable after seven years, and the company may force conversion after two years.
The five-year loan bears interest at Libor plus 700 basis points, with a Libor floor of 1%. The loan's collateral will be about 2.8 million common units of Rentech Nitrogen. It may be prepaid and was issued at 98. The loan has an accordion feature and may be increased by $75 million.
Proceeds will be used for growth opportunities in Rentech's wood fiber processing business.
Los Angeles-based Rentech develops technologies and projects that transform underused energy resources into an alternative fuel and chemicals.
| Issuer: | Rentech, Inc.
|
| Issue: | Convertible preferred stock, term loan
|
| Amount: | $150 million
|
| Warrants: | No
|
| Investor: | GSO Capital Partners LP
|
| Settlement date: | April 9
|
| Stock symbol: | Nasdaq: RTK
|
| Stock price: | $1.80 at close April 8
|
| Market capitalization: | $468.71 million
|
|
|
| Preferreds
|
| Amount: | $100 million
|
| Price: | 98
|
| Dividends: | 4.5%
|
| Conversion price: | $2.22
|
| Conversion ratio: | Into about 45 million shares
|
| Call: | Yes
|
|
|
| Loan
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| Amount: | $50 million
|
| Maturity: | Five years
|
| Coupon: | Libor plus 700 bps, Libor floor of 1%
|
| Price: | 98
|
| Call: | Yes
|
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