Spark Energy gets $25 million debt facility from majority shareholder

By Wendy Van Sickle

Columbus, Ohio, Dec. 28 – Spark Energy, Inc. entered into a 3.5-year $25 million subordinated debt facility with Retailco, LLC, Spark’s majority shareholder which is wholly owned by founder and chairman Keith Maxwell, according to a press release.

The facility will bear a fixed annual interest rate of 5%.

A special committee of Spark’s board of directors made up of independent directors reviewed and approved the terms of the subordinated debt facility.

“With this sponsor-supported debt facility, the company has increased flexibility to quickly and efficiently address various strategic initiatives utilizing a low cost of capital,” Nathan Kroeker, Spark president and chief executive officer, said in the release.

The company said it plans to use the facility for working capital, growth initiatives and capital optimization, including stock buybacks, subject to lender approval.

The debt facility is unsecured and is subordinated to the company’s senior credit facility. Spark plans to draw down $5 million under the new facility before Dec. 31.

Spark is a retail energy services company based in Houston.

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