Pacific Coast Canola Enters Agreements to Increase Liquidity
Date Posted: January 10, 2014
Winnipeg—Legumex Walker Inc. (TSX: LWP) (the "Company") announced Jan. 8 that its Pacific Coast Canola (PCC) subsidiary has entered into agreements with Macquarie Bank Limited (Macquarie Bank) that provide additional liquidity of up to US$45 million.
The agreements include: 1) a 3-year US$10 million borrowing facility for working capital purposes, at market interest rates, with annual renewals; 2) a US$15 million hedging line that allows PCC to enter into forward purchase and sales contracts and 3) up to US$20 million for physical grain purchase transactions for canola seed.
"PCC is adding new customers weekly and these new US$45 million facilities significantly expand our ability to leverage our production capacity and capitalize on the high demand for both our canola oil and canola meal," said Joel Horn, President and Chief Executive Officer, Legumex Walker Inc.
"PCC's new credit facilities include a US$15 million hedging line that allows us to enter into forward sales contracts with customers while protecting us from commodity price fluctuations."
In addition to the agreement with Macquarie Bank, PCC has an existing US$12M working capital loan from a syndicate of lenders and a continuing trade credit agreement with CHS for the sale of canola meal and canola oil.
A material change report prepared in accordance with Canadian securities laws relating to the transactions described in this release will be available on www.sedar.com within 10 calendar days.
For more information, call 206-535-2427.