Atlas Technical replaces debt with new loans on better terms

By Taylor Fox

New York, Feb. 26 – Atlas Technical Consultants, Inc. replaced its current debt and preferred equity agreements with a more economically favorable term loan credit agreement funded by funds and accounts managed or advised by Blackstone Credit or its affiliates, according to a news release.

The new financing consists of $432 million of long-term debt maturing in 2028 and a $75 million committed delayed draw term loan.

Atlas also replaced its existing revolving credit facility with a new five-year, $40 million asset based revolver with JPMorgan Chase Bank, NA.

A portion of the proceeds from the new debt was used to repay all of the $270 million of outstanding borrowings under the company’s existing term loan, including by rolling nearly $62 million of existing term loans into the new term loan, as well as to redeem in full its $154 million of outstanding series A preferred equity units.

The transaction lowers the overall interest rate on debt by nearly 100 basis points, including a 375 bps reduction in the interest rate spread on the revolver to Libor plus 250 bps, while eliminating the Libor floor.

The transaction also reduces amortization on long-term debt from the current 5% annually to 0% in year one and 1% after that through the term of the loan, which has been extended by two years to 2028.

Atlas is an Austin, Texas-based provider of professional testing, inspection, engineering and consulting services.

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