Calfrac Well Services to repay bank loans using 9%/12% term proceeds

By Susanna Moon

Chicago, June 10 – Calfrac Well Services Ltd. said it plans to repay its bank debt under the syndicated revolving credit facilities and the borrowings of Calfrac Well Services (Argentina) SA using proceeds of a new term loan with Alberta Investment Management Corp., or Aimco.

The company closed a debt-with-warrants financing that included a C$200 million 9%/12% second-lien senior secured term loan due Sept. 30, 2020 with Aimco, according to an announcement.

No amendments were made to the available commitment, term, covenants or interest rates payable under Calfrac's existing credit facilities as part of the required approvals for the term loan.

As part of the arrangements with Calfrac's lending syndicate, any repurchase of unsecured notes is limited to C$200 million and subject to a minimum liquidity requirement of C$100 million. Any repurchase of notes must result in a reduction of annual net interest costs on a dollar-for-dollar basis.

"Aimco is an ideal long-term investor for Calfrac, and the funds secured through this financing, together with our fully funded equity cure announced last December, will ensure that we are well-positioned to navigate this period of market weakness and capitalize on the opportunities expected to arise as market conditions recover,” Fernando Aguilar, president and chief executive officer of Calfrac, said in the press release.

“We would also like to recognize and thank our lending syndicate for its ongoing commitment to our business, as evidenced by its support of this transaction through the intercreditor agreement that was concluded as part of this financing."

Calfrac is a Calgary, Alta.-based company that provides specialized oilfield services to exploration and production companies.

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