Petrowest has achieved certain important milestones in its restructuring and refinancing efforts. Over the next several months the company plans to reposition itself as a highly focused provider of heavy construction and infrastructure services with a strong balance sheet. To fully achieve this goal, Petrowest has embarked on a multi-pronged process to dispose of non-core assets, to reduce debt levels and to right-size the organization in the context of the future business plan.
The company has arranged for financing necessary to complete the restructuring plan. The existing bank syndicate has agreed to extend the waiver period from May 19, 2017 to September 30, 2017. The amount of credit available under the existing bank facilities has been set at $38 million which is the amount currently outstanding. It is anticipated that proceeds from the sale of non-core assets will be sufficient to fully repay the bank loans on or before September 30, 2017.
The company closed a financing with Crown Capital for a $12 million bridge loan that matures on November 30, 2017. The bridge loan is expected to be repaid with proceeds received on the sale of non-core assets that exceed amounts applied to the repayment of the senior bank debt. The bridge loan will be used to fund the company’s working capital needs through the restructuring period.
In addition, Crown has agreed to refinance the existing $15 million term loan maturing September 2018 with a new $15 million term loan maturing May 2020. In connection with the Crown financing, Petrowest has issued 7.3 million common shares to Crown and its affiliates and has cancelled the 4.3 million common share purchase warrants previously issued to Crown.
Calgary-based Petrowest is a diversified infrastructure company with primary operations based in northeastern British Columbia and Alberta.