Business
Dollarama announces new credit facility
Dollarama announces new credit facility
About this update from Dollarama Inc.
[{"type":"text","content":"\n\n\n\n Jun. 10, 2010 (Canada NewsWire Group) -- MONTREAL, June 10 /CNW Telbec/ - Dollarama Inc. ("Dollarama" or the "Corporation") (TSX: DOL) today announced that Dollarama Group L.P. ("Group LP"), a wholly-owned subsidiary of the Corporation, has entered into an agreement providing for a new all-Canadian $600 million syndicated senior secured credit facility (the "New Credit Facility").\nGroup LP intends to use the proceeds of the New Credit Facility to repay its senior secured credit facility (the "Existing Credit Facility"), to redeem and discharge the senior floating rate deferred interest notes issued by its affiliate, Dollarama Group Holdings L.P. (the "Deferred Interest Notes"), to repay the debt-related hedging obligations, to pay related fees and expenses and the balance for working capital and other general corporate purposes. The New Credit Facility will consist of: (i) a $75 million revolving credit facility, and (ii) a $525 million term loan A facility maturing in June 2014. At Dollarama's current leverage level, the New Credit Facility will accrue interest at BA + 275 bps.\nThe New Credit Facility will be secured by a security interest encumbering substantially all of existing and future assets of Group LP, as well as its subsidiaries.\n"This New Credit Facility will improve our financing terms and eliminate our foreign currency exposure on long-term debt" said Michael Ross, Chief Financial Officer of the Corporation.\nAs at the end of the quarter ended May 2, 2010, the Existing Credit Facility consisted of: (i) a $237.4 million term loan B facility maturing in November 2011; and (ii) an undrawn $75.0 million revolving credit facility. As at the same date, there was $215.5 million in aggregate principal amount and deferred interest outstanding on the Deferred Interest Notes, as well as $60.1 million of debt-related hedging obligations.\nThe New Credit Facility has been arranged by RBC Capital Markets, Canadian Imperial Bank of Commerce and The Bank of Nova Scotia.\n\nAbout Dollarama\n\nIn 1992, the Dollarama business was founded by our Chief Executive Officer, Larry Rossy, a third generation retailer. We are the leading dollar store operator in Canada with 611 locations across the country. Our stores provide customers with compelling value in c...