CTBH Partners LLC Announces Successful $ 105.2 Issue
HANOVER, NH, June 22, 2021 (GLOBE NEWSWIRE) – CTBH Partners LLC (“CTBH”) is pleased to announce the closing of $ 105.2 million in total principal of exempt industrial solid waste revenue tax obligations for its customer, Waste Pro USA, Inc. (“Waste Pro” or “the Borrower”). As financial advisor to the borrower, CTBH represented Waste Pro in connection with the Florida Development Finance Corporation (the “Issuer”) issuance of tax obligations for the disposal of solid waste (Waste Pro USA , Inc. Project) Series 2021 (the “Bonds”) for the benefit of Waste Pro.
The Bonds, which bear a 3,000% coupon for approximately 11 years, were valued at 104.584, with total proceeds of approximately $ 110.0 million, for a yield of 2.375%. The Bonds will mature on June 1, 2032 and are guaranteed by certain subsidiaries of Waste Pro, in accordance with the terms of the Bond indenture.
The Bonds do not constitute a general obligation of the Issuer and do not constitute a debt or a charge on the general credit of the Issuer. The Bonds are not a debt or pledge of the faith and credit of the State of Florida and are payable only out of amounts received from Waste Pro under the Loan Agreement between Waste Pro and the Issuer and the Guarantors in under the Guarantee.
Citigroup Global Markets Inc. was Bookrunner and Senior Director and Wells Fargo Securities LLC was Co-Manager of the Bonds. Greenberg Traurig, PA was counsel for Waste Pro.
Overview of private activity obligations
Since 1968, private companies and non-profit organizations can finance qualifying projects by borrowing the proceeds of tax-exempt private activity bonds (PABs) issued by an intermediary issuer as an alternative to traditional corporate debt. . PABs are municipal bonds issued by or on behalf of local or state governments for the purpose of providing special financial benefits for qualified private projects that serve a public purpose, including solid waste disposal facilities. Other activities eligible under the Internal Revenue Code include airports, docks and wharves, wastewater treatment facilities, district heating, road or surface cargo transfer facilities, and capital expenditures. allowable 501 (c) (3), subject to certain conditions set out in the Internal Revenue Code.
Solid Waste PABs are sometimes also referred to as Industrial Tax Bonds (or “IRBs”). In the context of IRBs, the Internal Revenue Code defines solid waste disposal facilities as “all or part of the property used for the collection, storage, treatment, use, treatment or final disposal of solid waste ”. Recycling facilities may also qualify in many cases.
The benefits of PABs include (i) potentially significant interest rate savings due to the tax-exempt status of the bonds, (ii) potentially longer-term debt than that otherwise available, (iii) the potential for access to an additional pool of investor capital, and (iv) flexible financing structures. However, to enjoy these benefits, the borrower must comply with various federal and state regulatory requirements which can result in smaller bond issuances and a more complex bond issuance process (with compliance requirements before and after issuance) than traditional corporate debt. Nonetheless, the use of PABs is widespread in many industries by publicly traded and private companies as well as non-profit organizations.
Based on data collected internally, the issuance of tax-exempt PABs is more common with (i) health institutions, (ii) colleges and universities, (iii) electricity utilities, (iv ) oil and gas companies, (v) airlines, as well as (vi) environmental control companies. Collectively, organizations in these sectors have approximately $ 400 billion in tax-exempt PABs outstanding.
About Waste Pro USA, Inc.
Waste Pro is one of the nation’s fastest growing private waste collection, recycling, treatment and disposal companies, operating in nine southeastern states. Waste Pro serves more than two million residential customers and 40,000 commercial customers at more than 90 operating sites. Waste Pro is headquartered in Longwood, Florida, and manages over 250 exclusive municipal contracts and franchises.
About CTBH Partners LLC
CTBH Partners is a leading independent financial advisory firm in the environmental sector, according to The Bond Buyer’s Annual Review of Municipal Bond Transactions, specializing in tax-exempt debt offerings for companies with spending in eligible capital. CTBH is registered as a city councilor with the Municipal Securities Rulemaking Board and the United States Securities and Exchange Commission. CTBH does not engage in any form of subscription, negotiation, marketing or investment in securities.
Since its inception, CTBH has provided advisory services to borrowers on more than $ 360 million of tax-exempt solid waste industrial revenue bonds in six states. For more information, visit the company’s website at https://ctbhpartners.com.