Biosolids fertilizer producer reorganizing
Synagro Technologies, Inc. announced that it has reached an agreement to sell substantially all of its assets to EQT Infrastructure II in a transaction valued at $455 million as the culmination of a plan to strengthen its balance sheet and position the company for growth.
Synagro Technologies provides a system of solutions for civic and commercial organizations that recycles organic by-products. Main operations are treating wastewater for cities and recycling the byproducts for use as fertilizer and as an energy source. The company says it has more than 600 customer locations across North America that rely on its biosolids management solutions.
In order to complete the sale and deleveraging in a timely and efficient manner, the Synagro Technologies company is proposing to implement the sale pursuant to Section 363 of the U.S. Bankruptcy Code. As a result, Synagro and certain of its subsidiaries filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware.
Synagro anticipates the sale will be completed in approximately 60 to 90 days. In connection with the filing, certain existing lenders have committed to provide $30 million of additional capital in the form of debtor-in-possession financing subject to court approval. The financing, along with the company's cash flow from operations, will provide ample liquidity to operate the business and meet ongoing obligations to customers, vendors, and employees through the completion of the sale process.
Synagro claims it will continue all operations as usual throughout the Chapter 11 process.