Enviva Partners amended and restated its senior secured revolving credit facility. The transaction closed on April 16.

The amended and restated senior secured revolving credit facility extends the maturity to April 2026 from October 2023, increases the facility’s size to $525 million from $350 million, reduces the applicable interest rate margin and includes other improved terms compared with the prior credit facility. The applicable interest rate margin in the amended and restated credit facility is determined according to a total leverage ratio-based pricing grid, which for a Eurodollar revolving credit borrowing is 2.25% based on the current level of leverage compared with 2.5% under the prior credit facility.

Enviva Partners expects to use future borrowings under the amended and restated credit facility to support its growth initiatives and drop-down acquisitions and for general partnership purposes. Enviva Partners continues to target a leverage ratio between 3.5x and 4x. Additionally, Enviva Partners expects to continue financing growth initiatives and acquisitions with 50% equity and 50% debt.

“With strong support from our bank group, we have taken another significant step toward reducing Enviva’s cost of capital and increasing our financial flexibility while maintaining our conservative financial policies and leverage,” Shai Even, executive vice president and CFO of Enviva Partners, said. “The amended credit facility is a reflection of the increased scale, diversification and tremendous market opportunities ahead for Enviva, and the expanded revolver will be an important tool for us to fund the accelerating growth anticipated by the partnership over the next several years.”

Barclays is administrative agent and collateral agent on the amended and restated credit facility and, together with Bank of Montreal, Citibank, Goldman Sachs Bank, HSBC Bank, JPMorgan Chase Bank and Royal Bank of Canada, acted as joint bookrunner, joint lead arranger and co-documentation agent. AgFirst Farm Credit Bank and American AgCredit acted as joint bookrunners, joint lead arrangers and co-syndication agents.

Enviva Partners is a publicly traded master limited partnership that aggregates wood fiber and processes it into wood pellets.