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AgroFresh announces agreements with Dow and Avenue Capital

AgroFresh Solutions announced revisions to various agreements arising from its separation from The Dow Chemical Company. Collectively, these revisions increase the company’s equity and reduce its interest expense and cash payments associated with certain ongoing obligations.

Jordi Ferre, Chief Executive Officer, commented, "The modifications negotiated with Dow and Avenue Capital reflect their confidence in AgroFresh, our proprietary SmartFresh technology and the future prospect for the Company to become the leader in solutions that extend the freshness and quality of fruit and produce from storage to retail. Not only will this agreement immediately increase our equity and improve our future financial performance by reducing the interest expense and cash payments, importantly it will help us accelerate our path into future growth.”

The existing Tax Receivables Agreement has been amended to provide that AgroFresh’s obligations to make future payments will be reduced from 85% to 50% of the tax savings associated with the step-up in the value of the AgroFresh assets that occurred in connection with the business combination. The net present value of the TRA liability will be reduced by $65 million and interest expense on this obligation is expected to decrease by approximately $6 million per year.

Dow has also agreed to buy up to 10% of AgroFresh’s outstanding shares through open market purchases. Additionally, the company, Dow and Avenue have agreed to terminate the Warrant Purchase Agreement entered into in connection with the business combination, with no further obligations on the part of any of the parties. Lastly, Dow and Avenue Capital (through its affiliates) have agreed to make available up to $100 million of aggregate borrowing capacity for potential strategic acquisitions by the company.

For more information:
www.agrofresh.com

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