Water Pipeline Project Receives Financing
Cadiz Inc. has entered into a strategic transaction with Apollo Global Management, LLC to initiate financial arrangements for the construction and implementation of the Cadiz Water Project. Under the terms of the transaction, Cadiz’s senior secured mortgage debt will be replaced and refinanced and $15M of new senior debt will be provided to fund immediate construction related expenditures. Apollo also executed a conditional commitment letter to fund up to $240M in construction finance expenditures for the project, subject to the satisfaction of conditions precedent.
The Cadiz Water Project is a public-private partnership between Cadiz and the Santa Margarita Water District that will deliver a new, reliable water supply for 400,000 Californians every year without adverse environmental impacts. Construction will be completed in two phases, with Phase 1 consisting of a 43-mile pipeline to be built in an active railroad right-of-way to the Colorado River Aqueduct that will transport conserved water from Cadiz’s private property in the Mojave Desert to public water purveyors throughout the region. Phase 2 will enable the storage of up to 1M acre-feet of imported water and make possible the interconnection of Colorado River Aqueduct and Northern California sources in a common groundwater storage program. Construction of the project is expected to create and support nearly 6,000 jobs.
“We are excited by the unique opportunity to support Cadiz at this critical juncture,” said Antoine Munfakh, a Partner at Apollo Global Management. “As active infrastructure investors, we believe innovative projects, like Cadiz, can solve many of the important issues facing municipalities today. The project brings a reliable and vital new water resource and water storage option to the Southern California region.”
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