Advanced Drainage Systems announced that it will begin a private placement of up to $500 million of senior unsecured notes due 2034. The notes will be issued in a private transaction exempt from registration requirements, allowing the company to raise capital without a public offering.
The company will use the proceeds to refinance its existing senior secured credit facility and redeem its 5.000% senior notes due 2027. In addition, ADS will increase the revolving credit facility to $750 million and the term loan B to $600 million, extending the facility’s maturity. These actions are intended to extend debt maturities, improve liquidity, and provide flexibility for future growth initiatives such as acquisitions and capital expenditures.
As of December 2025, ADS reported net debt of $270.6 million, a net debt‑to‑EBITDA ratio of 0.30 and an interest coverage ratio of 10.9. The refinancing and credit facility amendment are expected to strengthen the balance sheet and support the company’s ongoing investment in water‑management solutions for stormwater and onsite wastewater across commercial, residential, infrastructure and agricultural markets.
S&P Global Ratings assigned a ‘BB‑’ issue‑level rating to the proposed notes and maintained a ‘BB’ rating with a positive outlook on ADS itself, indicating a stable view of the company’s creditworthiness. In pre‑market trading on February 12, the company’s stock was quoted at $173.17, reflecting a neutral market reaction to the announcement.
The financing move positions ADS to better manage its capital structure, extend debt maturities, and increase liquidity, thereby supporting its strategic focus on sustainable water‑management solutions and potential future acquisitions.
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