NEW YORK, Aug. 27, 2021 /PRNewswire/ -- Covanta
Holding Corporation (NYSE: CVA) (the "Company" or "Covanta")
announced that Covert Mergeco, Inc, a Delaware corporation ("Merger Sub"), an
affiliate of certain investment funds affiliated with EQT
Infrastructure, has commenced solicitations of consents (each, a
"Consent Solicitation") from holders ("Holders") of the Company's
6.000% Senior Notes due 2027 (the "2027 Notes") and 5.000% Senior
Notes due 2030 (the "2030 Notes" and, together with the 2027 Notes,
the "Notes" and each a "Series of Notes") to certain amendments
(the "Proposed Amendments") to the Indenture, dated as of
January 18, 2007, by and between the
Company and Wells Fargo Bank, National Association, as trustee (in
such capacity, the "Trustee") (as amended and supplemented, the
"Indenture").
The Consent Solicitations are being conducted in connection with
the previously announced merger agreement, pursuant to which, among
other things, Merger Sub will merge with and into the Company (the
"Merger"), with the Company continuing as the surviving corporation
in the Merger as a wholly owned subsidiary of Covert Intermediate,
Inc., a Delaware corporation (the
"Parent"). In connection with the Merger, certain lenders have
committed to provide Merger Sub with the debt financing in an
aggregate principal amount of (i) up to $3,000 million currently, after a reallocation of
$125 million from the senior secured
term loan facility to the unsecured bridge facility, expected to
consist of senior secured term loan facilities in an aggregate
principal amount equal to $1,375
million (which consists of a $1,275
million term loan B facility, which includes a backstop
delayed draw term sub-facility in an aggregate principal amount
equal to $400.0 million, and a term
loan C sub-facility for the purpose of cash collateralizing
existing letters of credit in an aggregate principal amount equal
to $100 million) and a senior
unsecured bridge facility in an aggregate principal amount equal to
$1,625 million (including a backstop
delayed draw bridge sub-facility in an aggregate principal amount
equal to $1,100 million) and (ii) up
to $440 million revolving credit
facility (the "Debt Financing"). The Merger would constitute a
"Change of Control" under the Indenture, which may result in a
Change of Control Triggering Event (as defined in the Indenture)
for a Series of Notes if such Series of Notes are downgraded by
either Rating Agency (as defined in the Indenture) on any date
during the period commencing 60 days prior to the consummation of
such Change of Control and ending 60 days following consummation of
such Change of Control. Merger Sub currently does not expect that
the ratings of the Notes will be downgraded by either Rating Agency
in connection with the Merger. The Proposed Amendments with respect
to each Series of Notes relate to (i) the elimination of the
requirement to make a "Change of Control Offer" with respect to
such Series of Notes in the Indenture in connection with the Merger
and the implementation of certain other customary changes for a
privately-held company to the "Change of Control" provisions in the
Indenture, and (ii) certain customary changes for a privately-held
company to the reporting covenant with respect to such Series of
Notes in the Indenture. In addition, in connection with the Merger,
subject to and within 60 days of the closing date, certain
subsidiaries of the Company that will be guarantors of the Debt
Financing will enter into a supplemental indenture to the Indenture
to, jointly and severally, guarantee the obligations with respect
to each Series of Notes, and such guarantees shall not be
contingent on the Proposed Amendments and will be provided
regardless of the results of the Consent Solicitations.
Holders of each Series of Notes who validly consent to the
Proposed Amendments relating to such Series of Notes as part of the
applicable Consent Solicitation on or prior to 5:00 p.m., New York
City time, on September 8,
2021 (such date and time, as they may be extended, the
"Consent Date"), will be eligible to receive a consent fee of
$5.00 in cash for each $1,000 in principal amount of such Series of
Notes for which consents are received on or prior to the Consent
Date.
Approval of the Proposed Amendments relating to a particular
Series of Notes requires consents from the relevant Holders of at
least a majority in aggregate principal amount of such Series of
Notes then outstanding, excluding any Notes owned by the Company or
any of its affiliates (the "Requisite Consents"). Upon receipt of
the Requisite Consents to the Proposed Amendments relating to a
particular Series of Notes, the Company and the Trustee will
execute and deliver a supplemental indenture (a "Supplemental
Indenture") to the Indenture, setting forth the applicable Proposed
Amendments. Consents relating to a particular Series of Notes may
only be revoked prior to the time the Requisite Consents relating
to such Series of Notes are received and the applicable
Supplemental Indenture is executed. The Proposed Amendments
contained in a Supplemental Indenture relating to a particular
Series of Notes will become operative on the date the consent fee
relating to such Series of Notes is paid. After the Proposed
Amendments relating to a particular Series of Notes become
operative, all current Holders of such Series of Notes, including
non-consenting Holders of such Series of Notes, and all subsequent
Holders of such Series of Notes will be bound by the relevant
Proposed Amendments to the Indenture. Merger Sub's payment of the
consent fee relating to a particular Series of Notes is conditioned
upon, among other things, receipt of the Requisite Consents
relating to such Series of Notes on or prior to the Consent Date
and the closing of the Merger. Merger Sub considers the
solicitation of Consents of the Holders of the 2027 Notes and the
2030 Notes as a separate Consent Solicitation and each Consent
Solicitation may be individually amended, extended or terminated,
and a Holder of both Series of Notes may elect, at its sole
discretion, to consent to the Proposed Amendments with respect to
only one such Series of Notes without consenting to Proposed
Amendments with respect to the other Series of Notes.
If all of the conditions to any Consent Solicitation are
satisfied or waived, Merger Sub will, substantially concurrent with
the closing of the Merger, pay the consent fee relating to the
applicable Series of Notes to each holder of such Series of Notes
who validly consented and did not revoke their consent on or prior
to the Consent Date.
No consent fee will be paid in connection with a Consent
Solicitation if the Requisite Consents relating to the applicable
Series of Notes are not received, if such Consent Solicitation is
terminated prior to the closing date of the Merger for any reason
or if the Merger is not closed. Merger Sub reserves the right to
terminate, withdraw or amend any Consent Solicitation at any time
and from time to time, as described in the Consent Solicitation
Statement. None of Merger Sub, Parent, Company, the Solicitation
Agents (as defined below), the Trustee, the information, tabulation
and paying agent nor any of their respective affiliates makes any
recommendation as to whether or not holders of any Series of Notes
should consent or refrain from consenting with respect to such
Series of Notes.
If the Requisite Consents relating to a particular Series of
Notes are not received, Merger Sub intends to terminate the Consent
Solicitation relating to such Series of Notes and, in such case,
Merger Sub would, in the event of a "Change of Control Triggering
Event" with respect to such Series of Notes, conduct a "Change of
Control Offer" with respect to such Series of Notes in accordance
with the terms and conditions of the Indenture, if required by the
Indenture.
This announcement does not constitute an offer to sell any
securities or the solicitation of an offer to purchase any
securities. Each Consent Solicitation is being made only pursuant
to the Consent Solicitation Statement dated August 27, 2021. The Consent Solicitations are
not being made to Holders of Notes in any jurisdiction in which the
making or acceptance thereof would not be in compliance with the
securities, blue sky or other laws of such jurisdiction. In any
jurisdiction in which the securities laws or blue sky laws require
any Consent Solicitation to be made by a licensed broker or dealer,
such Consent Solicitation will be deemed to be made on behalf of
Merger Sub by one or more registered brokers or dealers that are
licensed under the laws of such jurisdiction.
Barclays Capital Inc. and Credit Suisse Securities (USA) LLC are acting as the solicitation agents
(in such capacity, the "Solicitation Agents") for the Consent
Solicitations. D.F. King & Co., Inc. is acting as the
information, tabulation and paying agent for the Consent
Solicitations.
Requests for the Consent Solicitation Statement may be directed
to D.F. King & Co., Inc. at (212) 269-5550 (for brokers and
banks) or (866) 828-6934 (for all others) or covert@dfking.com.
Questions or requests for assistance in relation to the Consent
Solicitations may be directed to Barclays Capital Inc. at (800)
438-3242 (toll free) or (212) 528-7581 (collect) or Credit Suisse
Securities (USA) LLC at (800)
820-1653 (toll free) or (212) 325-2476 (collect).
About EQT
EQT is a purpose-driven global investment organization with more
than EUR 67 billion in assets under
management across 26 active funds. EQT funds have portfolio
companies in Europe, Asia-Pacific and the Americas with total sales
of approximately EUR 29 billion and
more than 175,000 employees. EQT works with portfolio companies to
achieve sustainable growth, operational excellence and market
leadership.
About Covanta
Covanta is a world leader in providing sustainable waste and
energy solutions. Annually, Covanta's modern Waste-to-Energy
("WtE") facilities safely convert approximately 21 million tons of
waste from municipalities and businesses into clean, renewable
electricity to power one million homes and recycle 600,000 tons of
metal. Through a vast network of treatment and recycling
facilities, Covanta also provides comprehensive industrial material
management services to companies seeking solutions to some of
today's most complex environmental challenges. For more
information, visit www.covanta.com.
Forward-Looking Statements
Certain statements in this press release may constitute
"forward-looking" statements as defined in Section 27A of the
Securities Act of 1933 (the "Securities Act"), Section 21E of the
Securities Exchange Act of 1934 (the "Exchange Act"), the Private
Securities Litigation Reform Act of 1995 (the "PSLRA") or in
releases made by the Securities and Exchange Commission ("SEC"),
all as may be amended from time to time. Forward-looking statements
are those that address activities, events or developments that the
Company's or Merger Sub's management intend, expect, project,
believe or anticipate will or may occur in the future. They are
based on management's assumptions and assessments in light of past
experience and trends, current economic and industry conditions,
expected future developments and other relevant factors. They are
not guarantees of future performance or actual results.
Developments and business decisions may differ from those envisaged
by forward-looking statements. Forward-looking statements,
including, without limitation, statements with respect to the
Consent Solicitations and the Merger, involve known and unknown
risks, uncertainties and other important factors that could cause
the actual results, performance or achievements of the Company, its
subsidiaries and joint ventures or industry results, to differ
materially from any future results, performance or achievements
expressed or implied by such forward-looking statements, in
particular, the Merger which depends on the satisfaction of the
closing conditions to the Merger and the Consent Solicitations, and
there can be no assurance as to whether or when the business
combination or any Consent Solicitation will be consummated. For
additional information see the Cautionary Note Regarding
Forward-Looking Statements in the Company's 2020 Annual Report on
Form 10-K as well as Risk Factors in the Company's most recent
Quarterly Report on Form 10-Q for the period ended June 30, 2021. Merger Sub and the Company
expressly disclaim any obligation or undertaking to release
publicly any updates or revisions to any forward-looking statements
to reflect any change in expectations or events, conditions or
circumstances on which any such statements are based.
Where to Find Additional Information
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval. This communication may be deemed to be
solicitation material in respect of the proposed merger between
Covanta and affiliates of EQT Infrastructure. In connection with
the proposed merger, Covanta intends to file a proxy statement with
the SEC. SECURITY HOLDERS ARE ADVISED TO READ THE PROXY STATEMENT
WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN IMPORTANT
INFORMATION. Security holders may obtain a free copy of the proxy
statement (when available) and other documents filed by Covanta
with the SEC at http://www.sec.gov. Free copies of the proxy
statement, once available, and Covanta's other filings with the
SEC, may also be obtained from the respective companies. Free
copies of documents filed with the SEC by Covanta will be made
available free of charge on Covanta's investor relations website at
https://investors.covanta.com/.
Participants in the Solicitation
Covanta and its directors and executive officers may be deemed
to be participants in the solicitation of proxies of Covanta's
stockholders in respect of the proposed merger. Information about
the directors and executive officers of Covanta is set forth in its
Annual Report on Form 10-K for the fiscal year ended December 31, 2020, which was filed with the SEC
on February 19, 2021. Stockholders
may obtain additional information regarding the interest of such
participants by reading the proxy statement regarding the proposed
merger when it becomes available.
Merger Sub Contacts:
US Inquiries:
Stephanie Greengarten
+1 646 687 6810
stephanie.greengarten@eqtpartners.com
International Inquiries:
EQT Press Office
+46 8 506 55 334
press@eqtpartners.com
Covanta Contacts:
Investor Contact:
Dan Mannes
+1 862 345 5456
IR@covanta.com
Media Contact:
Nicolle Robles, Covanta
+1 862 345 5245
NRobles@covanta.com
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SOURCE Covanta Holding Corporation
