Atlas Energy Solutions Announces Refinancing of Term Loan Facility

Rhea-AI Summary

Atlas Energy Solutions (NYSE: AESI) has announced a refinancing agreement with Stonebriar Commercial Finance for its existing term loan facility. The new arrangement consists of a $540.0 million single advance term loan with a seven-year maturity extending to March 1, 2032.

The Term Loan will carry an interest rate of 9.51% and includes mandatory amortization at 4.00% per annum until March 1, 2029, after which no mandatory amortization is required. The proceeds will be used to repay the existing Stonebriar facility and for general corporate purposes.

Positive

• Secured long-term financing with extended maturity until 2032
• No mandatory amortization required after March 2029
• Provides additional capital for general corporate purposes

Negative

• High interest rate at 9.51%
• Mandatory 4% annual amortization for first 5 years

Insights

Financial Analyst

This $540 million refinancing agreement represents a strategic move that strengthens Atlas Energy Solutions' financial position in several key ways. The new seven-year term loan's structure, with its 9.51% interest rate and front-loaded 4% annual amortization schedule through 2029, provides a well-balanced approach to debt management.

The extended maturity to 2032 is particularly noteworthy in the current market environment, where many energy services companies are facing refinancing pressures amid volatile interest rates. By securing this long-term facility, Atlas has effectively locked in its cost of capital and reduced refinancing risk for the next seven years.

The amortization schedule is thoughtfully structured - the 4% annual mandatory amortization until 2029 followed by no mandatory payments helps optimize cash flow management. This structure allows Atlas to systematically reduce its debt burden during the initial years while maintaining flexibility in the latter part of the loan term.

The 9.51% fixed rate, while reflecting current market conditions, provides certainty in debt servicing costs. This predictability in interest expenses is valuable for long-term financial planning and helps shield the company from potential future rate increases.

The refinancing also demonstrates lender confidence in Atlas's business model and financial health. Stonebriar's willingness to maintain and expand its lending relationship suggests strong underlying fundamentals and positive assessment of the company's credit profile.

AUSTIN, Texas--(BUSINESS WIRE)-- Atlas Energy Solutions Inc. (NYSE: AESI) (“Atlas” or the “Company”) today announced that it has entered into an agreement with Stonebriar Commercial Finance, LLC ("Stonebriar") to refinance its existing term loan facility with a new $540.0 million single advance term loan (the “Term Loan”). Proceeds from the Term Loan will be used to repay the existing facility from Stonebriar and for general corporate purposes. The Term Loan matures in seven years with a final maturity date of March 1, 2032, will bear an interest rate of 9.51%, and features mandatory amortization at a rate of 4.00% per annum until March 1, 2029, after which there is no mandatory amortization.

About Atlas Energy Solutions

Founded in 2017, Atlas Energy Solutions Inc. (NYSE: AESI) is a leading energy solutions provider, primarily serving the Permian Basin of West Texas and New Mexico. Atlas operates 14 proppant production facilities across the Permian Basin, including both large-scale in-basin facilities and smaller distributed mining units, making Atlas the largest Permian proppant provider. In addition, we manage a portfolio of leading-edge logistics assets, which includes our 42-mile Dune Express conveyor system, the only proppant conveyor system in the world and the longest conveyor in the United States. We also manage a fleet of over 120 trucks, including early autonomous delivery systems, which are capable of delivering expanded payloads due to our custom-manufactured trailers and patented drop-depot process. Our approach to managing proppant production and logistics is intently focused on leveraging technology, automation, and remote operations to drive efficiencies. We have a relentless mission to improve human beings’ access to the hydrocarbons that power our lives, and by doing so we maximize value creation for our stockholders.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Statements that are predictive or prospective in nature, that depend upon or refer to future events or conditions or that include the words “may,” “assume,” “forecast,” “position,” “strategy,” “potential,” “continue,” “could,” “will,” “plan,” “project,” “budget,” “predict,” “pursue,” “target,” “seek,” “objective,” “believe,” “expect,” “anticipate,” “intend,” “estimate” and other expressions that are predictions of or indicate future events and trends and that do not relate to historical matters identify forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements regarding the entry into the Term Loan and the anticipated use of proceeds therefrom; our business strategy, industry, future operations and profitability; expected capital expenditures and the impact of such expenditures on our performance; statements about our financial position, production, revenues and losses; our capital programs; management changes; current and potential future long-term contracts; and our future business and financial performance.

Although forward-looking statements reflect our good faith beliefs at the time they are made, we caution you that these forward-looking statements are subject to a number of risks and uncertainties, most of which are difficult to predict and many of which are beyond our control. These risks include but are not limited to: uncertainties as to whether the transaction will achieve its anticipated benefits and projected synergies within the expected time period or at all; Atlas’s ability to integrate Moser Energy Service, Inc.’s (d/b/a Moser Energy Systems) (“Moser”) operations in a successful manner and in the expected time period; risks that the anticipated tax treatment of Atlas’s acquisition of Moser (the “Moser Acquisition”) is not obtained; unforeseen or unknown liabilities; potential litigation relating to the Moser Acquisition; unexpected future capital expenditures; the effect of the completion of the Moser Acquisition on the parties’ business relationships and businesses generally; potential difficulties in retaining employees as a result of the Moser Acquisition; risks related to future investments in our new distributed power platform; potential negative effects of the completion of the Moser Acquisition on the market price of Atlas’s common stock or operating results; our ability to successfully execute our stock repurchase program or implement future stock repurchase programs; commodity price volatility, including volatility stemming from the ongoing armed conflicts between Russia and Ukraine and Israel and Hamas; increasing hostilities and instability in the Middle East; adverse developments affecting the financial services industry; our ability to complete growth projects on time and on budget; the risk that stockholder litigation in connection with our recent corporate reorganization may result in significant costs of defense, indemnification and liability; changes in general economic, business and political conditions, including changes in the financial markets; transaction costs; actions of OPEC+ to set and maintain oil production levels; the level of production of crude oil, natural gas and other hydrocarbons and the resultant market prices of crude oil; inflation; environmental risks; operating risks; regulatory changes; lack of demand; market share growth; the uncertainty inherent in projecting future rates of reserves; production; cash flow; access to capital; the timing of development expenditures; the ability of our customers to meet their obligations to us; our ability to maintain effective internal controls; and other factors discussed or referenced in our filings made from time to time with the U.S. Securities and Exchange Commission (“SEC”), including those discussed under the heading “Risk Factors” in Annual Report on Form 10-K, filed with the SEC on February 27, 2024, and any subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250221032088/en/

Investor Contact

Kyle Turlington

5918 W Courtyard Drive, Suite #500

Austin, Texas 78730

United States

T: 512-220-1200

IR@atlas.energy

Source: Atlas Energy Solutions Inc.

FAQ

What is the size of Atlas Energy Solutions' (AESI) new term loan facility?

Atlas Energy Solutions' new term loan facility is $540.0 million.

What is the interest rate on AESI's new term loan announced in 2024?

The new term loan bears an interest rate of 9.51%.

When does Atlas Energy Solutions' (AESI) new term loan mature?

The term loan matures in seven years, with a final maturity date of March 1, 2032.

What is the amortization schedule for AESI's new $540M term loan?

The loan requires 4.00% annual amortization until March 1, 2029, after which there is no mandatory amortization.

Who is the lender for Atlas Energy Solutions' new term loan refinancing?

Stonebriar Commercial Finance, is the lender for the new term loan refinancing.