Infrastructure and Energy Alternatives, Inc. Provides an Update on Recently Announced Potential Transactions
October 09 2019 - 4:21PM
Infrastructure and Energy Alternatives, Inc. (NASDAQ: IEA) (“IEA”
or the “Company”), a leading infrastructure construction company
with specialized energy and heavy civil expertise, is providing an
update on the status of the potential preferred stock financing and
merger transactions detailed in the previously announced
non-binding indicative term sheet (the “August Term
Sheet”).
As previously announced on August 14, 2019, the
Company entered into an Equity Commitment Agreement (the “Equity
Commitment Agreement”) among the Company, funds managed by the
Private Equity Group of Ares Management Corporation (NYSE:ARES)
(“Ares”), a leading global alternative asset manager, and funds
managed by Oaktree Capital Management (“Oaktree”), whereby the
Company agreed to issue and sell 50,000 shares of Series B
Preferred Stock and 900,000 warrants to purchase the Company’s
common stock at an exercise price of $0.0001 to Ares for an
aggregate purchase price of $50.0 million (the “Tranche One
Transaction”). The Tranche One Transaction was completed on
August 30, 2019 and the net proceeds from the transaction were used
for working capital and to reduce outstanding borrowings under the
Company’s revolving credit facility.
In addition, the Company also announced that it had entered into
the August Term Sheet with Ares that provided for, among other
things, the issuance of an additional 110,000 shares of Series B
Preferred Stock (the “Tranche Two Transaction”) and a possible
merger resulting in the Company going private (the “Merger”).
The non-binding indicative term sheet called for Ares to provide
60% of the capital for the Tranche Two Transaction and the Merger
with the remaining 40% coming from an unidentified third party.
The parties are now discussing an
alternative transaction to the transactions contemplated in the
August Term Sheet that would include an additional investment in
IEA preferred stock by Ares, but which does not include the Merger
or any other going private transaction. The Company will make an
announcement when, and if, a final transaction is agreed upon by
all parties.
JP Roehm, Chief Executive Officer of
Infrastructure and Energy Alternatives, Inc. commented, “We believe
that the $100 million of equity financings that we completed with
Ares and Oaktree in the last six months has strengthened our
balance sheet, significantly improved our liquidity and put us on
solid footing to execute our 2019 business plan. We are working
diligently to complete the final phase of our balance sheet
improvement initiatives and are confident that we will have the
financial flexibility we need for continued growth in 2020. We
appreciate the support of Ares and Oaktree, who have taken on
larger roles as investors in IEA, as well as our public equity
investors and our lenders.”
About IEA
Infrastructure and Energy Alternatives, Inc.
(IEA) is a leading infrastructure construction company with
specialized energy and heavy civil expertise. Headquartered in
Indianapolis, Indiana, with operations throughout the country,
IEA’s service offering spans the entire construction process. The
Company offers a full spectrum of delivery models including full
engineering, procurement, and construction, turnkey, design-build,
balance of plant, and subcontracting services. IEA is one of three
Tier 1 wind energy contractors in the United States and has
completed more than 200 wind and solar projects across North
America. In the heavy civil space, IEA offers a number of specialty
services including environmental remediation, industrial
maintenance, specialty transportation infrastructure and other site
development for public and private projects. For more information,
please visit IEA’s website at www.iea.net or follow IEA on
Facebook, LinkedIn and Twitter for the latest company
news and events.
Forward Looking Statements
This release contains forward-looking statements within the
meaning of Section 27A of the Securities Act and Section 21E of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”).
The forward-looking statements can be identified by the use of
forward-looking terminology including “may,” “should,” “likely,”
“will,” “believe,” “expect,” “anticipate,” “estimate,” “forecast,”
“seek,” “target,” “continue,” “plan,” “intend,” “project,” or other
similar words. All statements, other than statements of historical
fact included in this press release, regarding expectations for the
use of offering proceeds, future financial performance, business
strategies, expectations for our business, future operations,
financial position, estimated revenues and losses, projected costs,
prospects, plans, objectives and beliefs of management are
forward-looking statements. These forward-looking statements
are based on information available as of the date of this release
and our management’s current expectations, forecasts and
assumptions, and involve a number of judgments, risks and
uncertainties. Although we believe that the expectations reflected
in such forward-looking statements are reasonable, we cannot give
any assurance that such expectations will prove correct.
Forward-looking statements should not be relied upon as
representing our views as of any subsequent date. As a result of a
number of known and unknown risks and uncertainties, our actual
results or performance may be materially different from those
expressed or implied by these forward-looking statements. Some
factors that could cause actual results to differ include:
- our ability to consummate the Tranche Two Transaction;
- availability of commercially reasonable and accessible sources
of liquidity and bonding;
- our ability to generate cash flow and liquidity to fund
operations;
- the timing and extent of fluctuations in geographic, weather
and operational factors affecting our customers, projects and the
industries in which we operate;
- our ability to identify acquisition candidates, integrate
acquired businesses and realize upon the expected benefits of the
acquisition of CCS and William Charles;
- consumer demand;
- our ability to grow and manage growth profitably;
- the possibility that we may be adversely affected by economic,
business, and/or competitive factors;
- market conditions, technological developments, regulatory
changes or other governmental policy uncertainty that affects us or
our customers;
- our ability to manage projects effectively and in accordance
with management estimates, as well as the ability to accurately
estimate the costs associated with our fixed price and other
contracts, including any material changes in estimates for
completion of projects;
- the effect on demand for our services and changes in the amount
of capital expenditures by customers due to, among other things,
economic conditions, commodity price fluctuations, the availability
and cost of financing, and customer consolidation;
- the ability of customers to terminate or reduce the amount of
work, or in some cases, the prices paid for services, on short or
no notice;
- customer disputes related to the performance of services;
- disputes with, or failures of, subcontractors to deliver
agreed-upon supplies or services in a timely fashion;
- our ability to replace non-recurring projects with new
projects;
- the impact of U.S. federal, local, state, foreign or tax
legislation and other regulations affecting the renewable energy
industry and related projects and expenditures;
- the effect of state and federal regulatory initiatives,
including costs of compliance with existing and future safety and
environmental requirements;
- fluctuations in maintenance, materials, labor and other
costs;
- our beliefs regarding the state of the renewable wind energy
market generally; and
- the “Risk Factors” described in our Annual Report on Form 10-K
for the year ended December 31, 2018, and in our quarterly reports,
other public filings and press releases.
We do not undertake any obligation to update forward-looking
statements to reflect events or circumstances after the date they
were made, whether as a result of new information, future events or
otherwise, except as may be required under applicable securities
laws.
Contact
Andrew Layman |
Financial Profiles, Inc. |
Chief Financial Officer |
Larry Clark, Senior Vice
President |
Andrew.Layman@iea.net |
lclark@finprofiles.com |
765-828-2580 |
310-622-8223 |
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