CoBank and American AgCredit underwrote a $175 million seven-year term loan for Cascades, increasing the company’s authorized credit facility to approximately C$1 billion ($736 million).

The term loan provides Cascades with increased financial flexibility and will reduce financing costs. The company’s existing banking syndicate supported the agreement.

The term loan, which can be repaid at any time, will be used to repay certain of the company’s outstanding borrowings under its existing credit facility.

The financial conditions and covenants of Cascades’ existing credit facility remained unchanged, and no additional assets were required as security.

Allan Hogg, Cascades vice president and chief financial officer, commented, “This agreement increases our financial flexibility, reduces our interest costs and supports our efforts to continue reinforcing our financial profile. Moreover, the seven-year term provides us with funding security over a longer timeframe, without requiring modification to the terms and covenants of our existing agreement.”

Founded in 1964, Cascades produces, converts and markets packaging and tissue products composed mainly of recycled fibers. It employs 11,000 staff members, who work in close to 90 production units in North America and Europe.