NextDecade Secures $175M Loan for LNG Expansion

By Tamara Parker • Monday, January 06 15:22 • Permanent Link

NextDecade Corporation (NASDAQ: NEXT) has secured a $175 million senior secured loan through its subsidiary, Rio Grande LNG Super Holdings, LLC. The loan, provided by General Atlantic Credit's Atlantic Park Fund, was disbursed on December 31, with the net proceeds set to be used for various purposes.

Out of the $175 million, NextDecade plans to use the funds to repay existing borrowings under its $50 million revolving credit facility and a $12.5 million interest term loan. Additionally, the company intends to allocate the proceeds towards working capital and general corporate purposes, including the development expenses for expansion trains 4 and 5 at the Rio Grande LNG facility.

The senior loan, which matures six years from the closing date, carries an interest rate of 12.0%, with interest payable quarterly. For the first two years after the closing date, interest may be paid in-kind, and thereafter, up to 50% can be paid in-kind.

As part of the agreement, NextDecade issued approximately 7.16 million warrants to GA Credit, each exercisable for one share of NextDecade common stock. These warrants are valid for five years after the closing date, with 50% exercisable at $7.15 per share and the remaining 50% exercisable at $9.30 per share.

Santander served as the exclusive financial advisor, while Latham & Watkins LLP acted as legal advisor to NextDecade. Akin Gump Strauss Hauer & Feld LLP and Baker Botts L.L.P. were the legal advisors to GA Credit in this transaction.

NextDecade Corporation, headquartered in Houston, Texas, is an energy company focused on accelerating the path to a net-zero future. The company is actively developing a 27 million tons per annum (mtpa) LNG export facility in South Texas, along with one of the largest proposed carbon capture and storage projects in North America. Additionally, through its subsidiary Next Carbon Solutions, NextDecade is working on deploying proprietary processes to lower the cost of carbon capture and storage and reduce CO2 emissions at industrial-scale facilities globally. Today the company's shares have moved -1.0% to a price of $8.14. Check out the company's full 8-K submission here.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.