DLC announces closing to TD credit facilities

This represents the latest step in its plan to streamline its business

DLC announces closing to TD credit facilities

Dominion Lending Centres has announced that it closed its new credit facilities with Toronto-Dominion Bank in late December.

The credit facilities are composed of three senior term credit facilities and a junior term credit facility.

“We are pleased to announce the closing of the TD financing, the full repayment of the Sagard (USD) credit facility and closure of our foreign exchange forward contracts,” said Gary Mauris, executive chairman and CEO of DLC. “Replacing our high-yield debt with conventional bank financing is another step to further simplify our business.”

Read more: DLC reveals Q3 results

The senior credit facilities provide DLC with a $5-million revolving working capital credit line, a $10-million revolving acquisition credit line, and a $20-million term loan to fund its issuer bid dated Dec. 1, 2021, and a pro rata (40%) dividend to preferred shareholders.

The junior credit facility provides DLC with a $32-million term loan “to facilitate the repayment of all indebtedness of the corporation under the current Sagard credit facility and to terminate all existing foreign currency forward contracts,” the lender said.

On closing, the acquisition credit facility part of the senior credit facilities had a drawn balance of $6.2 million, while the junior credit facility had a drawn balance of $31 million. 

“Given the meaningful reduction in our cost of capital, the new TD credit facilities provide significant savings to our shareholders and also provide DLCG with financial flexibility to pursue our growth objectives over fiscal 2022 and beyond,” Mauris said.