CALGARY, Sept. 4, 2013 /CNW/ - Petrowest Corporation (PRW : TMX) announced today that it has entered into a new $30 million revolving operating credit facility with Bank of Montreal (the "New Facility"). The New Facility matures in 36 months.
The interest rate for the New Facility is, at the election of Petrowest, the prime rate or the discount rate for bankers acceptances. The New Facility is secured by a general security agreement providing a first ranking security interest over all of the working capital/current assets of Petrowest Corporation and of each subsidiary and limited partnership in the Petrowest group and a second ranking security interest over all other assets.
The New Facility allows Petrowest to draw up to $30 million, based upon a borrowing base determined by the value of accounts receivable. A total of $18.5 million was funded at closing, and $11.5 million remains available to draw by Petrowest subject to borrowing base availability.
Lloyd Wiggins, Petrowest's Chief Financial Officer, stated, "we are pleased to have entered into a new credit facility with interest rates significantly lower than our existing $22.2 million Canadian dollar term loan. The lower carrying costs will benefit Petrowest from both a cash flow and bottom line perspective going forward. In addition, the New Facility will provide us with financing based on our working capital requirements."
The existing $22.2 million Canadian dollar term loan (which had a maturity date of June 13, 2015) is being paid out with the proceeds from the New Facility and cash on hand.
Petrowest is an Alberta corporation involved in pre-drilling and post-completion energy services as well as industrial and civil infrastructure projects, gravel crushing and hauling for non-energy sector customers. Petrowest's primary operations are based in the Grande Prairie area of northern Alberta and in northeastern British Columbia.
SOURCE: Petrowest Corporation
For further information:
Richard Quigley, President and Chief Executive Officer, at (780) 830-0881, or Ian Hogg, Vice President, Corporate Affairs, at (403) 384-0407, or Lloyd Wiggins, Chief Financial Officer, at (416) 572-2160, or [email protected]