CVC facilitates oil buyout with unitranche package

The debt fund manager has also left open the possibility of additional financing should certain circumstances arise.

CVC Credit Partners has provided a unitranche facility allowing the acquisition of oil drilling waste management company TWMA. The financing was provided to London-based private equity shop Buckthorn Partners.

The investment was attractive to CVC, in part, due to the manner in which TWMA has navigated an environment where energy prices have been under pressure. 

“Clearly, oil and gas is a market that’s been through some challenges,” Chris Fowler, managing director at CVC, told PDI. “We were particularly impressed with the management team’s ability to grow the business in what has been a difficult environment.”

The characteristics of TWMA’s business were also attractive to CVC. “From a credit perspective we believe there’s strong downside protection given the company’s services are highly regulated and embedded in their customer’s operations, providing long-term revenue visibility,” Fowler said. 

While precise terms of the debt facility could not be determined, Fowler noted it included certain provisions allowing the borrower to tap into additional capital should the need to do so arise. “There are various mechanisms to provide additional financing to support future growth initiatives,” he said. 

Fowler also noted Buckthorn has expertise in the oil and gas sector. The private equity firm approaches investments on a deal-by-deal basis, Fowler noted, adding Buckthorn doesn’t run a fund product.