Date: June 14, 2006
Source: WCA Waste Corp.
WCA Waste Corporation (Nasdaq: WCAA) announced today that the Company has signed an agreement for a $75 million convertible preferred equity investment (convertible at $9.60 per share with a 5% paid-in-kind dividend) with Ares Corporate Opportunities Fund II.
The Company is also pursuing additional transactions to refinance its existing senior secured debt. Assuming that the equity investment and other transactions close, the Company anticipates (based on pro forma financial information as of March 31, 2006):
its debt to total capitalization ratio (net of cash) would be reduced
from 66% to 40%;
its equity would increase from $94 million to $167 million;
at targeted debt levels, the senior secured debt will be refinanced at
LIBOR plus 175 basis points, a reduction of 125 basis points;
fixed interest rates on substantially all its debt, including LIBOR at
4.885% (plus the applicable margin) on $150 million.
Tom Fatjo, Chairman of the Company, stated, "The success of this capital plan will reduce the Company's leverage ratios and will result in an accretive transaction. We are excited to have Ares as a partner, given the industry expertise of several of its key executives, as well as the expanded financial flexibility this transaction provides."
The issuance of the preferred stock is subject to stockholder approval, refinancing of senior debt and other customary conditions.
WCA Waste Corporation is an integrated company engaged in the transportation, processing, and disposal of non-hazardous solid waste. The Company's operations consist of twenty landfills, twenty-one transfer stations/material recovery facilities and twenty-four collection operations located throughout Alabama, Arkansas, Colorado, Florida, Kansas, Missouri, New Mexico, North Carolina, South Carolina, Tennessee and Texas. The Company's common stock is traded on the NASDAQ National Market System under the symbol "WCAA".
ABOUT ARES MANAGEMENT LLC
Ares Management LLC ("Ares") is an independent Los Angeles-based investment firm with over 75 employees and approximately $6.0 billion of committed capital under management. Ares specializes in originating and managing assets in both the private equity and leveraged finance markets. Ares private equity activities are conducted through the Ares Corporate Opportunities Fund, L.P. ("ACOF"). ACOF focuses on injecting flexible, junior capital into industry-leading middle market companies to position them for growth. Ares leveraged finance activities include the acquisition and management of bank loans, high yield bonds, mezzanine and special situation investments, which are held in a variety of investment vehicles. For more information, visit: www.aresmgmt.com.
More information: www.wcawaste.com.
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