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Societe Generale, Spark Energy Upsize Facility in CenStar Acquisition

July 10, 2015, 07:18 AM
Filed Under: Energy

Spark Energy, Inc.  has acquired CenStar Energy, a retail energy company with approximately 75,000 residential customer equivalents. CenStar serves natural gas and electricity customers across 20 utilities in New York, New Jersey, and Ohio.

In conjunction with the acquisition of CenStar Energy, Spark also announced today that it has amended and upsized its senior credit facility. The previous $70.0 million senior secured revolving working capital credit facility increased to $85.0 million and now includes a line of credit to be used specifically for the financing of M&A transactions, including the closing of the Oasis acquisition which is expected later this quarter. In addition, Spark has the ability to add additional banks to the syndicate and increase the amount of available credit, subject to lender approval.

Click here to view the 8-K filing with the SEC.

The purchase price of CenStar is $8.3 million, subject to working capital adjustments. As part of the transaction, $2.1 million will be financed by an affiliate of Spark's founder and majority shareholder in the form of a 5% convertible subordinated note with a term of five years. The convertible subordinated note is convertible into shares of Class B common stock of Spark, along with units of Spark HoldCo, LLC, at a conversion price of $16.57 following an 18-month holding period.

Spark Energy, Inc. is an established and growing independent retail energy services company founded in 1999 that provides residential and commercial customers in competitive markets across the United States with an alternative choice for their natural gas and electricity.

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