PNC Provides ENSERVCO With New $16MM Credit Facility
ENSERVCO Corporation announced its new $16 million credit facility with PNC Bank. The facility, which consists of an $11 million term loan and a $5 million revolving line of credit, replaces substantially all of ENSERVCO’s prior credit facilities with Great Western Bank.
At the closing of the PNC facility, ENSERVCO also raised $1.25 million through a private placement of units priced at $350 per unit, with each unit consisting of 1,000 shares common stock and 500 common stock purchase warrants exercisable at $0.55. President and CFO Rick Kasch was among the several investors who participated in the offering.
The company also reported that chairman and CEO Mike Herman converted approximately $1.5 million in subordinated debt due to him by the company into units on the same terms as the private placement investors. Herman said, “Management’s increased equity stake in the company further strengthens its financial position, and is a clear indication of the confidence we have in ENSERVCO’s prospects for long-term financial growth and increased shareholder value.”
Kasch noted that the new credit facility and equity funds come at the same time the company is experiencing a strong rebound in demand for its core heating services following last year’s extraordinarily warm winter.
“We have seen a surge in demand across all of our service territories, which reflects more typical fall weather patterns, as well as the impact of our expansion into regions where the need for fluid heating extends throughout much of the fall, winter and spring seasons,” Kasch said.
ENSERVCO provides hot oiling, acidizing, frac heating and fluid management services.