Packaging
Solo Cup Company Completes Refinancing of Canadian Credit Facility
Tuesday 21. December 2010 - Also completes sale of Missouri manufacturing facility
Company ending 2010 with improved liquidity and greater financial flexibility
Solo Cup Company, a leading provider of single-use products used to serve food and beverages, today announced that it has successfully refinanced the credit facility supporting its Canada operations. The previous agreement was set to expire in September 2011. The new CA$17 million asset-based revolving loan facility extends liquidity to Solo Cup Canada through December 2013. The company chose GE Capital, its incumbent Canadian lender, as the provider of the new financing.
In addition, earlier this month the company completed the sale of its Springfield, Missouri manufacturing facility. The company received net proceeds from the sale of approximately $7.5 million, which it will reinvest in its business. As previously announced, the Springfield facility is scheduled to cease operations during the first quarter of 2011.
Actions taken by the company since the end of its third quarter have contributed $66 million towards the company’s improved liquidity position. Specifically, the company has increased its global cash balance by approximately $17 million and has reduced outstanding borrowings by approximately $49 million under its U.S. and Canadian asset-based loan facilities (ABLs). As of December 16, 2010, the company had a global cash balance of approximately $42 million and approximately $45 million outstanding under its ABLs.
“We initiated the Canadian refinancing process well ahead of the previous facility’s maturity date and are pleased by its successful conclusion,” said Robert M. Korzenski, president and chief executive officer of Solo Cup Company. “We are also pleased with the sale of our Springfield, Missouri manufacturing plant, just six months after we announced plans to close the facility. These developments and other strategic initiatives have enabled us to close 2010 in a much stronger liquidity position.”