Ceres Global Ag Corp. (TSX: CRP) has announced that the Bank of Montreal has provided the company with a five-year senior secured $50 million term debt credit facility, that includes a $30 million term loan draw.
The facility is to be used to drop Ceres’ term loan with Bixby Bridge Fund IV, LLC as well as an added $20 million delayed draw committed term loan that’s to be used to fund future initiatives and growth projects. The new credit facility is priced at Libor plus 3.5%, a significant decrease from the Bixby loan rate of Libor plus 6.0%.
Ceres went on record stating that having access to more capital at a reduced price is likely to impact their earnings in a positive manner, as well as providing needed capital to enact further growth and increase Ceres’s competitiveness in the markets. The company has also mentioned that the new credit facility should strengthen their balance sheet and offer decent growth potential.
Ceres has its headquarters in Golden Valley, Minnesota and operates 13 locations across Saskatchewan, Manitoba, Ontario, and Minnesota, together with its partnered companies. These 13 facilities have a total grain and oilseed storage capacity of roughly 31 million bushels.
Ceres Global Ag Corp. last traded on the TSX at $4.69.
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