Montrose Environmental Group Upsizes Credit Facility to $400 Million
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Insights
Montrose Environmental Group's upsizing of its Senior Secured Credit Agreement to $400 million indicates a strategic move to bolster its financial flexibility. The increase in both the revolving credit facility and the term loan by $50 million each is a significant liquidity booster. This enhancement of capital resources is a proactive step that can support Montrose in its growth initiatives and general corporate needs. The stable interest rates and unchanged maturity terms suggest that the company has secured these funds on competitive terms, which is commendable in the current financial environment where interest rates have been fluctuating.
From a financial perspective, the inclusion of an accordion feature is a forward-thinking approach. It offers Montrose the ability to expand its borrowing capacity up to $550 million under certain conditions. This feature provides a cushion for future expansion plans without the immediate need for renegotiation. It's also a sign of strong lender confidence, as financial institutions like Bank of America and others are willing to commit more capital. For stakeholders, this move can be seen as a positive indicator of the company's financial health and its management's confidence in pursuing growth opportunities.
The decision by Montrose Environmental Group to upscale its credit facility reflects a broader market trend where companies are seeking to strengthen their balance sheets in anticipation of growth opportunities or potential market headwinds. By increasing their capital resources, Montrose positions itself to take advantage of strategic investments that may arise, including mergers and acquisitions, capital expenditures, or other value-enhancing opportunities. This preparedness can be particularly advantageous in the environmental services industry, which is experiencing a growing demand due to increased regulatory pressures and a global emphasis on sustainability.
For investors, Montrose's actions may be interpreted as a signal of robust strategic planning. The company's ability to secure favorable terms from its lenders indicates a strong credit profile and a solid relationship with financial institutions. This move could potentially lead to positive market reactions, reflecting investor confidence in Montrose's long-term growth strategy and financial management.
Allan Dicks, Chief Financial Officer, commented, “We are pleased to announce the expansion of our Credit Facility on what we believe are very favorable and consistent terms. Our revised lending agreement augments our capital resources, further improves our already strong liquidity position, and enhances our ability to drive growth through value enhancing opportunities. We are grateful for our long-standing relationship with Bank of America and all of our lender partners and we believe this revised agreement reinforces their confidence in our long-term growth strategy.”
The Credit Facility includes an accordion feature that allows Montrose, under certain circumstances, to increase the size of the Credit Facility up to an aggregate amount of
Bank of America, N.A. acted as administrative agent and Capital One, JPMorgan Chase and BMO Bank as joint lead arrangers.
About Montrose
Montrose is a leading environmental solutions company focused on supporting commercial and government organizations as they deal with the challenges of today, and prepare for what’s coming tomorrow. With over 3500 employees across 90+ locations worldwide, Montrose combines deep local knowledge with an integrated approach to design, engineering, and operations, enabling Montrose to respond effectively and efficiently to the unique requirements of each project. From comprehensive air measurement and laboratory services to regulatory compliance, emergency response, permitting, engineering, and remediation, Montrose delivers innovative and practical solutions that keep its clients on top of their immediate needs – and well ahead of the strategic curve. For more information, visit www.montrose-env.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements may be identified by the use of words such as "intend," "expect", and "may", and other similar expressions that predict or indicate future events or that are not statements of historical matters. Forward-looking statements are based on current information available at the time the statements are made and on management’s reasonable belief or expectations with respect to future events, and are subject to risks and uncertainties, many of which are beyond the Company’s control, that could cause actual performance or results to differ materially from the belief or expectations expressed in or suggested by the forward-looking statements. Additional factors or events that could cause actual results to differ may also emerge from time to time, and it is not possible for the Company to predict all of them. Forward-looking statements speak only as of the date on which they are made, and the Company undertakes no obligation to update any forward-looking statement to reflect future events, developments or otherwise, except as may be required by applicable law. Investors are referred to the Company’s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2022, for additional information regarding the risks and uncertainties that may cause actual results to differ materially from those expressed in any forward-looking statement.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240220055875/en/
Investor Relations:
Rodny Nacier
(949) 988-3383
ir@montrose-env.com
Media Relations:
Doug Donsky
(646) 361-1427
Montrose@icrinc.com
Source: Montrose Environmental Group, Inc.
FAQ
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