Drax refinances Pinnacle $300m Canadian dollar facility

North Yorkshire-based power company Drax Group announced it has completed the refinancing of the Canadian dollar facilities it acquired as part of its acquisition of Pinnacle Renewable Energy Inc.

Drax announced in February it agreed to buy Canada-based Pinnacle — a producer of sustainable biomass — in a deal with an implied enterprise value of C$741 million ($580.58 million) including debt.

The new C$300 million term facility matures in 2024, with an option to extend by two years,and has a customary margin grid referenced over CDOR,” said Drax.

The facility reduces further the group’s all-in cost of debt to below 3.5% and includes an embedded ESG component which adjusts the margin payable based on Drax’s carbon intensity measured against an annual benchmark.

The facility, along with surplus cash, replaces Pinnacle’s approximately C$435 million facilities which had a cost of over 5.5%.”

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