TSX:IBG.DB.E - Post by User
Comment by
Calgaryrideron Jul 10, 2017 1:07pm
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Post# 26451496
RE:RE:RE:Improved Credit Facility
RE:RE:RE:Improved Credit FacilityIf you go on Sedar, you can read about several interesting details regarding the new great credit facility. It provides IBg a tone more flexibility than before. Frankly, they've earned it.
- Ability to invest $7.5M in any investment (eg technology
- Ability to pay off either 2019 or 2021 debentures, with several conditions related to leverage ration
- Ability to buy another entity (up to $45M) with conditions, incl. it's a viable (positive EBItda) business.
- Also, most importantly, the applicable margin on the loan is very attractive and decreases as the leverage ratio decreases over time. Clearly , IBG is poised to substantially reduce its interest payments for the duration of this deal and will not require another update on this for years to come.
Interestingly, the net debt used in the leverage ratio will include only up to $15M max in debentures. That puts IBGs leverage ratio in the 2.5 range which means with an EBitda of around $40M per annum and steady debt repayment, they will be around 2.0 by the end of the year, which is their target.