News..JTR acquires remaining 30 % of Central Roast
GreenSpace finalizes $7.5-million lending facility
2016-10-11 09:32 ET - News Release
Mr. Matthew von Teichman reports
GREENSPACE BRANDS CLOSES NEW ABL OPERATING FACILITY AND COMPLETES THE ACQUISITION OF CENTRAL ROAST
GreenSpace Brands Inc. has finalized a three-year, $7.5-million revolving senior secured asset-based lending (ABL) facility with the Toronto-Dominion Bank.
Proceeds from the new facility have been used to complete the acquisition of the remaining 30 per cent of the issued and outstanding shares of Central Roast Inc., making Central Roast a wholly owned subsidiary of GreenSpace.
The acquisition was completed pursuant to a mandatory secured purchase agreement signed in February, 2016, at the time of the acquisition of the initial 70-per-cent ownership of Central Roast, as amended. Total consideration for the purchase of the remaining interest was $4.5-million, $1.1-million was paid in cash as part of the use of proceeds in the company's bought deal short form prospectus offering completed on Sept. 2, 2016. The remaining consideration comprises $2.2-million in cash and $1.2-million in common shares in the capital of GreenSpace, resulting in the issuance of 1,006,114 common shares based on the 20-day volume-weighted average trading price (VWAP) of the common shares prior to closing. An additional bonus of between $800,000 and $1.5-million is payable dependent upon the Central Roast business exceeding certain revenue targets in the three-month period ended March 31, 2017, $500,000 of which is payable in cash and the remainder in common shares valued at the 20-day VWAP prior to the date of issuance.
"We are thrilled with the closing of the Central Roast acquisition. Central Roast has been an extremely successful acquisition for us as we continue to drive top-line results and realize bottom-line synergies through the integration process," commented Matthew von Teichman, the president and chief executive officer of GreenSpace "This new ABL facility, which has allowed us to finalize the Central Roast deal, is also much better aligned with our business, allowing us to effectively leverage the working capital investments we've made and will continue to make through this period of significant revenue growth. Refinancing all short-term obligations in such a cost-effective manner positions us well for future growth and allows us to focus on improving operating efficiencies in our business."
In conjunction with the closing of the ABL facility, the principal amount of an existing debt of $600,000 is now convertible into common shares at a price of $1.15 per common share. After closing the ABL facility, the company has now refinanced the majority of its short-term loan obligations under a long-term, cost-effective borrowing facility. Remaining initial proceeds from the new ABL facility are available to finance working capital, and capacity is still available to assist in the financing of future acquisitions.
About GreenSpace Brands
GreenSpace is a Canadian-based brand ideation team that develops, markets and sells premium natural food products to consumers across Canada. GreenSpace owns Rolling Meadow Dairy, Life Choices and Holistic Choice, as well as Love Child (B